Courtesy of ZeroHedge View original post here.
Authored by Mike Shedlock via MishTalk.com,
Let's discuss the relationship between tapering, Janet Yellen, Jerome Powell, and president Biden.
Tapering
At long last the world presumes the Fed will finally taper.
"Fed officials are going to wait until the process of tapering is complete and then they will take on raising interest rates. They know that there will be a fiscal cliff come Labor Day. The last thing they want to do is pile on declining stock prices."https://t.co/4RdhhrBCUa
— Danielle DiMartino Booth (@DiMartinoBooth) August 24, 2021
"Fed officials are going to wait until the process of tapering is complete and then they will take on raising interest rates. They know that there will be a fiscal cliff come Labor Day. The last thing they want to do is pile on declining stock prices."https://t.co/4RdhhrBCUa
— Danielle DiMartino Booth (@DiMartinoBooth) August 24, 2021
Hike After Tapering Complete?
How long will that take?
OK, so Goldman thinks the Fed will start tapering in Nov. 2021, at $15B a month ($10B UST, $5B MBS.) Whatever.
Even assuming they don't buy another $240B+ or so in the meantime, which they will, to get to 2008 levels would take about 42 YEARS.
This will never happen. pic.twitter.com/ewRoQNELLF
— Rudy Havenstein, Gain-of-Function Fintwit. (@RudyHavenstein) August 24, 2021
What About Fed Chair Jerome Powell?
Hey, thanks for asking.
Is her job to let Powell run all over her or it it her job to get in bed with him? Is there a difference?
There is no independent Fed.
Powell will either hop into bed with Biden and Yellen or he will be replaced.
Real Troika: Powell (or replacement), Biden, Yellen https://t.co/NXRQdqmUya
— Mike "Mish" Shedlock (@MishGEA) August 24, 2021
What's the Troika?
My comment regarding the Troika pertains to a comment made by former Fed Chair Ben Bernanke.
He once stated the only three opinions that mattered were those of the Fed Chair, the Vice-Chair, and the President of the New York Fed.
Currently that would be Jerome Powell, Richard Clarida, and John Williams, respectively.
New Troika
Given there is no independent Fed and Powell may be replaced if he does not go along with Biden Administration wishes, it is more realistic to think of the Troika as Powell, Treasury Secretary and former Fed Chair Janet Yellen, and President Biden.
"Powell will either hop into bed with Biden and Yellen or he will be replaced."
Progressives right now are putting pressure on Biden to replace Powell with someone more to their liking.
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