It should have been obvious a long time ago that the Fed wants Dem control of Congress to end. Yesterday’s Fed interest rate hike, which is one more hike in a series that are steeper and quicker than ever before, confirms that.Thanks for reading Meaning In History! Subscribe for free to receive new posts and support my work.
I’m a big Luongo fan (and patron) and listen to a lot of his podcasts. He gets a big excitable and doesn’t finish his thoughts sometimes but having heard his Fed vs Davos theory a few times and educated myself a bit more about finance, I get it. I also follow forecaster and geopolitical and economic analyst Martin Armstrong and he predicts 2023 will be a year of civil unrest and then 2024-2028 looks like WWIII with the world resetting in a new and better way in 2032. I guess time will tell. By the way, one of things that really helped me to understand the link between finance and geopolitics was this 50 mins YouTube animated video by hedge fund king Ray Dalio. I’m not a Dalio follower but this explainer of global finance is really good. https://youtu.be/xguam0TKMw8
"Congress needs to rein in spending to previous levels. The Fed is doing its job raising the cost of capital to divert money out of the unsustainable and into the sustainable. Monetary policy can signal entrepreneurs and investors to rebuild what’s degraded and look to where the economy has been neglected. But it can’t do that if Congress also wants to get in the act spending money that fuels keeping prices too high and crowding out investment where it wants to go, rather than where Congress wants it to go."
I couldn't agree more. Is this Liberaltarianism (did I get that right)? Whatever, fiscal responsibility and promotion of free capital flow have traditionally been promoted as Conservative ideals. Will the Republicans finally (FINALLY!) act according to their words and not their deeds of the last several decades? That could well be the key to the continued economic viability of this country. If Trump is elected again, will he hold the Republicans feet to the fire to be fiscally responsible? Or is he in reality (given political realities) a fiscal Democrat? Are the people he has endorsed for election fiscal conservatives?
The US Government cannot fund itself at 5% forever.
But it can fund itself at 5% for a lot longer than the UK can fund itself at 4.5%, a lot longer than Europe & China can fund themselves at 3%, and a lot longer than Japan can fund itself at 1%.
It's not the Democrats, its their spending and spam. This has to stop, especially as none of this spending is designed to improve productivity and the GNP. And the regulations, killing small business. Climate control, indeed! Woke, anybody?
Uk has lots of residential variable rate mortgages, us is fixed now days. U.S. commercial loans are variable. Plus the impact of interest rates on the us Gov debt.
Let's hope Tom is right. What is certain is that he is spot on about who are enemies are. Who are friends are is harder to tell. Davos will fail but the bodycount will be high.
I’m a big Luongo fan (and patron) and listen to a lot of his podcasts. He gets a big excitable and doesn’t finish his thoughts sometimes but having heard his Fed vs Davos theory a few times and educated myself a bit more about finance, I get it. I also follow forecaster and geopolitical and economic analyst Martin Armstrong and he predicts 2023 will be a year of civil unrest and then 2024-2028 looks like WWIII with the world resetting in a new and better way in 2032. I guess time will tell. By the way, one of things that really helped me to understand the link between finance and geopolitics was this 50 mins YouTube animated video by hedge fund king Ray Dalio. I’m not a Dalio follower but this explainer of global finance is really good. https://youtu.be/xguam0TKMw8
Assuming the Republicans win the midterms (both Senate and House) this sets up a really interesting scenario. Here is Luongo (from https://tomluongo.me/2022/10/06/31-trillion-dollar-question-can-fed-afford-pivot/ ):
"Congress needs to rein in spending to previous levels. The Fed is doing its job raising the cost of capital to divert money out of the unsustainable and into the sustainable. Monetary policy can signal entrepreneurs and investors to rebuild what’s degraded and look to where the economy has been neglected. But it can’t do that if Congress also wants to get in the act spending money that fuels keeping prices too high and crowding out investment where it wants to go, rather than where Congress wants it to go."
I couldn't agree more. Is this Liberaltarianism (did I get that right)? Whatever, fiscal responsibility and promotion of free capital flow have traditionally been promoted as Conservative ideals. Will the Republicans finally (FINALLY!) act according to their words and not their deeds of the last several decades? That could well be the key to the continued economic viability of this country. If Trump is elected again, will he hold the Republicans feet to the fire to be fiscally responsible? Or is he in reality (given political realities) a fiscal Democrat? Are the people he has endorsed for election fiscal conservatives?
Gonzalo Lira is fantastic. Gonna have to listen to this over weekend.
Tom Luongo (Give Deflation a Chance!)
@TFL1728
Bingo!
I know this because Powell knows this
Quote Tweet
Santiago Capital
@SantiagoAuFund
The US Government cannot fund itself at 5% forever.
But it can fund itself at 5% for a lot longer than the UK can fund itself at 4.5%, a lot longer than Europe & China can fund themselves at 3%, and a lot longer than Japan can fund itself at 1%.
It's not the Democrats, its their spending and spam. This has to stop, especially as none of this spending is designed to improve productivity and the GNP. And the regulations, killing small business. Climate control, indeed! Woke, anybody?
This article is troubling:
37% of US Small Businesses Can’t Pay Rent
https://www.independentsentinel.com/37-of-us-small-businesses-cant-pay-rent/
Uk has lots of residential variable rate mortgages, us is fixed now days. U.S. commercial loans are variable. Plus the impact of interest rates on the us Gov debt.
Interesting times…
Let's hope Tom is right. What is certain is that he is spot on about who are enemies are. Who are friends are is harder to tell. Davos will fail but the bodycount will be high.