JPwell 选择了硬刚
这新闻刚出来的时候，我头一次出现了字每个都认识，但是放到一起就看不懂了的感觉：
当前的抽象程度已经beyond imagination, such unprecedented movement from the executive branch will certainly, reshape the independence of Federal Reserve, of which is also the bedrock of this economy. The dual mandate had navigate us through many bumpy roads for past of several decades. Yet our president does not like an independent agency that does not obey his command.
Economic data had suggested a stagflation will appear if the Federal Funds Rate is not carefully adjusted. The hiring is slowing down with massive layoff on the Federal job cut. Private sector, from my observation is stabling, surly not looking great, but is not in a situation that requires aggressive intervention.
With such ridiculous excuse for someone only has 4 months left for his term, only logical conclusion is that Trump wants JPwell out immediately, and kill all possibilities for him to stay in as a board member. The economy needs time to recover, Fed balance sheet still has nearly 7 trillion dollars, including 4.2 trillion of bonds, and 2 trillion MBSs which Fed purchased during pandemic to provide liquidity to the market.
Fiscal Dominance is what this administration is seeking to, where monetary policies no longer serving to Fed’s dual mandate, especially the part of price stability, but supporting government finance. In long term this will destroy the credibility of the U.S. dollar. In such case, no matter who is the Fed chairman, he or she will against such pressure, because it is destroying the fundamental principals of the existence of this organization.
10+ years of QE, leads to uncontrolled leverage in every corner of the financial system. Reckless gamblers believe that “in the end, the Fed will save us all.” But with 8-9 trillion dollars of carried weight, even the Fed doesn’t have much fire power when next crisis arrives.