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Cleveland Fed

Even The Fed Is Flashing A Recession Warning

Even The Fed Is Flashing A Recession Warning

After The Cleveland Fed's warning of "significant stress" in the financial markets, we find none other than Dovish-hawk Jim Bullard's St.Louis Fed growing increasingly fearful of the "r" word.

The last two times, financial stress was this "significant," The Fed unleashed QE1 and Operation Twist...

 

 

And now, as Mises Institute's Mark Thornton notes, this little known chart (below) is the St. Louis Fed's attempt to anticipate a recession in the US economy.

Fed Financial Stress Index Points To "Significant" Market Instability

Fed Financial Stress Index Points To "Significant" Market Instability

The Cleveland Fed Financial Stress Index has been rising all year and just broke out to what The Fed describes as a "significant stress" period. The last two times this level of financial instability was breaking out across US markets Bernanke unleashed QE1 (Q1 2009) and Operation Twist (Q1 2012). 

"Significant Stress" has been reached...