The Fed has unleashed inflation.
And it wants more of it.
From mid-2014 until early 2016, commodities as an asset class, collapsed some 45%.
This was an all out bloodbath. But despite this collapse in prices, inflation began to perk up.
Since that time, numerous Fed officials, including Fed Vice-Chair Stanley Fischer have concluded that inflation has arrived and that the Fed wants more of it.
As we reported on Friday morning, in a surprise announcement the Fed revealed under its "Government in the Sunshine" protocol that it would hold a closed meeting under expedited procedures in which it would review the "advance and discount rates to be charged by Federal Reserve Banks." The last time such a meeting took place was less than a month before the Fed hiked rates for the first time in years.
Submitted by Bill Bonner of Bonner & Partners (annotated by Acting-Man.com's Pater Tenebrarum),
A Return to Gold
“What if you were appointed to head the Fed? In your first week on the job, what would you do?”
The question was not exactly serious. Neither was the answer.
“We’d call in sick.”
Sorry boys and girls, you’ll have to start without us…
Markets have stopped focusing on what central banks are doing and are "positioning for what they believe central banks may or may not do," according to BofA's Athanasios Vamvakidis as he tells FX traders to "prepare to fight the central banks," as the market reaction to central bank policies this year reflects transition to a new regime, in which investors start speculating which central bank will have to give up easing policies first.
The market has started testing the central banks