THE WOLF STREET REPORT: Stealth Stimulus Has Arrived

The Fed has already accomplished more with its verbiage this year than it had last time when it cut rates all the way to near-zero and did trillions of dollars of QE. And we’re seeing the first results. (11 minutes)

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  58 comments for “THE WOLF STREET REPORT: Stealth Stimulus Has Arrived

  1. Davebee says:

    What a world we live in. Now the entire US/global ‘growth’ story on the various bourses has to rely on confidence tricks and counterfeit money to make up the appearance of….What?…Prosperity???
    Is this what the ultimate achievement of the human brain has to show in the 21st century? Fake it till you make it.
    Well, as far as this little human brain can tell they STILL haven’t made it, certainly not since their hair-on-fire panic of 2008, that’s for sure!
    May the good Lord preserve all of us from this criminal lunacy!

    • Dale says:

      Shorter-term Treasury rates are down significantly. But how much of that is because of huge demand for any positive return (2% >> 0% or negative), plus the fact that the debt ceiling results no new net debt offering.

      The Fed is still removing (up to) $30B / month, and the markets had grown accustomed to $85B / month in new net issuances for the last 2+ years.

      Let’s see what happens when / if (a) the Fed stops QT, plus (b) the Treasury goes to the markets for an initial $250B (assuming the debt ceiling is resolved immediately) plus resumes $85B / month. Will short-term interest rates increase again?

      If not, then Ray Dalio is probably right, and we are on the inevitable path to MMT.

      • Les says:

        Until a new bill authorizes the Treasury department to issue debt, there is no net new supply. The crash in interest rates is largely result of the suspension of the debt ceiling and the Fed’s announcement of the upcoming purchase of treasuries in October. The 2-year Treasury yield is signaling 50 basis point cut in the Fed Funds rate, but that is only because the Fed is manipulating longer rates in the absence of supply. Much of the global QE over the last four years has taken place over periods where the debt issuing authority was suspended.

  2. Auld Kodjer says:

    I just don’t know, Wolf. Should you meet an untimely end, will the number one suspect be Musk or Powell?

    Thank you for another fine report. They are the dog’s bollocks.

  3. Groucho says:

    Wolf makes the point that the Fed has got more significant results from its recent jawboning than it got previously by actually lowering rates. Fair enough, but the problem is that it has created the expectation that lower rates are imminent. I think you might see some fireworks if Powell doesn’t come through in July.

    No more soup for you !!!

    • nick kelly says:

      Exactly. The Fed said ‘your check is in the mail’
      Now if it isn’t Trump and the Street will (for a change) have a bona fide cause for complaint.

      I don’t understand why this outfit is so craven. The institution’s supposed independence is disappearing. The Fed is committing institutional suicide a week at a time.

      So the market gives up 5 %. So what?
      By any measure except an assumption of future earnings it is the most expensive since 1929.
      If you want a soft landing you must first descend.

      I’ve done a little very rough figuring about the FAANGS versus the real economy, taking the front runner, Apple.
      I compared it to Winnebago.
      In terms of market cap (i.e per billion of cap) Winnebago has 47 times the number of employees. It also orders all kinds of material.

      Preliminary conclusion: the Fed is kowtowing to the stock price of a company that is already the richest in the world and one that apart from
      the ‘wealth effect’ in portfolios, has little relation to the real economy.

      Gee, what a tragedy if Apple Watch flops or the consumer decides he doesn’t actually need a thousand dollar phone. Is the Fed supposed to have the vapors?

      Something like 29, society is obsessed with the stock market. CNBC’s ‘Trading Nation’ is an apt term. After the crash, the day traders were an object of derision. Now they’re back, with millions of people imagining they are smarter than the others.

      The Fed should not encourage this fantasy with a Greenspan Put 3.0

      • bungee says:

        nick kelly,

        “So the market gives up 5 %. So what?”

        As long as it goes right back up then no big deal. But if it’s another 5 and then another… well.
        It’s really not day traders. Most people “in” stocks are not investors – they’re confused savers. Wealth and trust funds, pension funds, 401ks, IRAs and all the rest of the stuff that trickled out after the ERISA act. The American people wrongly view these vehicles as savings. And because of these schemes people feel they’ve been responsible. They believe they are owed something.
        If a few gamblers lose money, so what? But when a nation loses its ‘savings’ the people start dusting off their pitch-forks. The fed’s job is to not push the ‘print’ button for as long as possible, but when the time comes, push it hard.
        Also, in the podcast, Wolf is saying companies live and operate on debt. There’s gonna be no money to borrow in a falling market. And this will affect the employees of those companies who are paid with debt. So I agree with people who say that the fed is beholden to the stock market.

        • nick kelly says:

          Fact: there will be a recession. That’s when the Fed as you say has to ‘push hard’ which in the past has meant cuts of 5 percent.
          It could do this in the past because it ‘reloaded’ during the recovery.

          How will it do it now, when it’s wasted its opportunity trying to keep Wall Street at record highs.

          The American people ‘wrongly view these vehicles as savings’

          Agree. Because interest rates for fixed income are so low they have no choice. The ‘cure’, low rates, created a bigger problem as with other pain meds.

          I think you make a good case as to how the Fed is boxed in by the move from fixed and guaranteed income into (so far) higher returns in stocks that are not guaranteed.

          Unlike many critics of the Fed on this site and others, I agree it did what it had to do in 2007-2008.

          But saving the economy from death does not mean saving it from pain. It is normal for the stock market to fluctuate. The economic cycle can’t be rescinded because it’s human nature to gamble and overextend when offered credit.

          Bear markets were not always associated with financial collapse. Since WWII the average length is 1.4 years with an average loss of 40 %. Life and the economy went on.

          It is the idea that if there is bear market or even a correction the Fed is supposed to act as if there was a recession that has got us into this mess.

          If this could go on forever, so what, but at some point the Fed will not be able to rescue us.

  4. fjcruiserdxb says:

    Very interesting article. It shows only emotion seems to rule markets nowadays. It is a short term win for the Fed for achieving lower long term rates without actually doing anything. The big medium risk is the market being so emotional may realise sooner or later that if the Fed does nothing in July, there will be panic again and many loosing their shirts. I personally find it very difficult to invest in such markets when it seems fundamentals no longer apply.

    • Dale says:

      “I personally find it very difficult to invest in such markets when it seems fundamentals no longer apply.”

      It has been a long 11 years since fundamentals have applied, and likely to be 20+ more years, assuming Bernanke was right that interest rates will not normalize in his lifetime.

      • Cashboy says:

        Nobody seems to be talking about gold.
        They seem to discuss holding FIAT that has basically been printed out of thin air that pays out negative interest rates or junk bonds with low interest rates wiith a good chance they will lose the capital. I just don’t get it.

        I have been buying gold between Jun 2013 and Jul 2017 on the basis of what I thought was logical on the basis of elimination (shares, stocks etc). I am 35% up (in GB pound terms) on the basis that I bought the gold with GB pounds.
        However I could have made a lot more with shares.

        Now lets see if gold will continue its rise as it has “broken through that resistence US$1,400” that all those investors were talking about for the last 6 years.

    • Nat says:

      “I personally find it very difficult to invest in such markets when it seems fundamentals no longer apply.”

      I feel you there, no place looks good to stick money at the moment. Maybe a money market fund, but sometimes these days I think the mattress might be better … but what to stuff under there, dollars? PMs? other?

      I have never touched crypto and it still seems ridiculous to me, but now everything seems so ridiculous that the ridiculousness of crypto just doesn’t seem that unreasonable any more. As bad an investment as bitcoin might be, its fundamentals seem better then Lyft, Tesla, Uber, and many other popular stocks. Can I move crypto onto a thumb drive and stick that under my mattress? I don’t think so from my limited understanding (all coins should be permanently affixed to the on-line block chain, the system can’t work otherwise), but I am running out of other things that I also don’t think will work either so why not try.

      • Harrold says:

        You can store your Bitcoin wallet on a thumb drive and place it under your mattress for safe keeping until you want to spend your Bitcoins.

      • medialAxis says:

        “Can I move crypto onto a thumb drive and stick that under my mattress? ”

        No, but you can move[1] your private keys onto a thumb drive and stick that under my mattress? So long as only you have the private keys, only you can move the bitcoin. DuckDuckGo (or Google) “Not your keys, not your bitcoin”, and Andreas will tell you more.

        [1] And I mean “move” , not copy.

      • bungee says:

        Not knowing anything about bitcoin even I found a way to buy it and put it into “cold storage” and i keep that thumb drive in a safe. I also have private keys printed out on paper hidden away somewhere. But ill have to re-learn everything when i sell. But i bought years ago when it was waaaaaay cheaper. The real reason i didnt sell at 19000 was because it was too much hassel haha. And i lost money trying to figure it all out when i first bought. I got ripped off by bitrex and other shady ‘exchanges’ and i lost about $1,000.00 as ‘tuition.’ i guess my point is that its a crazy, volatile market thats already had astronomical gains. Gold on the other hand is still cheap, easy to research and buy and drop dead simple to understand. I dont have any of the apprehension about my gold like i do my bitcoin and consider the former to be savings and the latter to be pure speculation.
        Best of luck

    • John says:

      Maybe your stealth stimulus comment is on the right track!
      That would explain why risk off has returned to the $TED spread &other liquidity preference indicators.

  5. MoreDebtPlease says:

    Does any of this really matter when it seems to me that the global central banking cartel’s master game plan is to have a debt jubilee, aka as the “great reset” as has been discussed by some on Wall Street (Mauldin).

    The IMF just verbally spanked Switzerland again for not being in debt deep enough like the rest of the developed world. The great reset can not happen unless all parties are in the same dire situation. Unfortunately for the master planers, the Swiss have only 40% debt to GDP, only 1/3 of the 130% average of other developed nations.

    Read for yourselves:

    • Dale says:

      Switzerland is to be commended for its careful ways.

      I will note, however, that Swiss household debt to GDP is 129%, while US household debt to GDP is just 76%. (Got to keep those house prices high!) But the government and business sectors seem to be doing well.

      Wolf doesn’t like links, but for example:

  6. rich black says:

    Not all U.S. real estate markets are created equally. Even in this time of ten-year Treasury rate drops and lower mortgage costs, Florida and New Jersey are seeing serious upticks in their foreclosure rates. People are fleeing NJ as its property tax rates, already at deal killer levels, continue to rise. In Florida, especially in the Panhandle area, the combination of low wages and increasing costs of property taxes and insurance rates, are pushing defaults by low wage earners and fixed income retirees. Can’t see how the Fed’s jawboning will fix these problems.

    • AlamedaRenter says:

      Florida can be attributed to hurricane damage…some cities haven’t been rebuilt at all and people are walking away from mortgages on houses that don’t exist anymore.

      • Laughing Eagle says:

        AlamedaRenter – In Florida that has been mostly in Mexico Beach where Hurricane Irma Sept. 2017 hit and which later classified as a 5, but not in other areas unless you want to go back to Hurricane Andrew in 1992.

  7. Joe says:

    I find it amazing how car safety has been dumped for profit.
    I see a mass of lawsuits when people realize how unsafe electric cars are.
    If they were worried of cellphones by their heads image all these batteries under the car which is both explosive and has electrocuted some mechanics…All for the sake of quick profits on poor safety research…
    Remind you of Boeing?

    • Harrold says:

      I’ve seen no stats that suggest electric automobiles are more unsafe than ICE powered automobiles?

      Certainly the 2019 Toyota Pruis with its crash imminent breaking, its 3 air bags in the front seat and side impact protection system is much safer than the 1985 Chrysler K cars.

      • Joe Lalonde says:

        You won’t see anything that could disillusion the push for electric cars by our governments. They are convinced to be environmentally friendly. Until the lawsuits come….shhhhhhh…

      • Iamafan says:

        I went out to buy a car today. It is a great time to buy one nowadays. I was all alone in a big shop. The customers are taking a rest.

  8. David Hall says:

    How does an inverted or flattened yield curve affect bank lending?

    Why was a yield curve inversion sometimes a precursor to negative GDP growth?

    US house flipping activity reached a nine year high in Q1 2019. There had been an increase in high interest – low collateral loans originated by private equity (non-banking) businesses to house flippers.

    Where is the next crisis coming from? Check the usual places.

  9. Michael Engel says:

    1) Gravity with the negative rate cause the US yield
    curve mid section to cave in, dragging the long duration down with them, beyond Fed control. Rates are ganging on each, creating a bottleneck.
    2) Central banks are swinging in their infantile play ground.
    Short duration up, long duration down. Up & down its a lot of fun, even for serious adults with PhD in economy.
    The swing base is sinking, because of their weight, amplitude is short and their legs dug in a big hole in the ground.
    3) Negative rates purpose is to keep stability and tranquility, to kick the can down. On the stock markets they are system control with positive feedback.

  10. w.c.l. says:

    I am still confused. If we are indeed in a borrow and spend (credit) economy and even if the Fed gets people to borrow more it still has to be paid back or stiff the creditor at some point and thereby reducing spending that’s propping up the market in the future. I’m with you, I don’t see what the Fed hopes to accomplish with cuts other than to try to delay the inevitable market reset they know is coming.

    • Dale says:

      I’m with you.

      Over the last 60 years, real per capita PCE has increased by 200%, even while for 70% of employed Americans real wages have been flat. The difference has mainly been taken up by increased debt and reduced savings.

      But we can always look forward to negative interest rates. Imagine receiving interest every month on your mortgage, instead of paying it. That is what the central banks are planning (already implemented in some European countries).

    • James Levy says:

      In the olden days of Smith, Ricardo, Mill and Marx they didn’t call it Political Economy for nothing. The most critical issue for people with money and power is holding onto that money and power. The political economy of the United States is designed to keep the rich and powerful rich and powerful. For the first time since the 1960s, that order is threatened, at least a little bit, by having a loose cannon Republican in the White House and a disgruntled Democratic base that is sick and tired of the status quo. This is why the Biden wing of the Democratic Party would really rather loose to Trump than let those who would rearrange the deck chairs get into office–must protect their rich guy and corporate tax cuts and deregulation at all costs. The Fed and the financial sector know things are not sustainable, but they’ll hold things together as long as they can in order to maintain the current political and economic dispensation against any threat from below.

  11. RD Blakeslee says:

    What happens to gold and silver valuation (NOT fiat price) when the reset comes?

    • JM says:

      Right question, but if you read the monetary history the gold is the negative answer for the private citizens, because the world central banks will always have to predominate, therefore the gold will be equated to the national currency, with the reinitialisation that is the resetting of all debts the physical and monetary assets will be in the zeroing calculation. In other words, gold or dollars or other currencies will be depreciated as will all other real estate assets.

      • bungee says:

        gold will not be ‘depreciated’.
        and debt will not be ‘reset’. it will be paid off in worthless dollars and yen.
        gold will NOT be ‘equated to the national currency.’ it will be an asset trading in physical form only. used as a reserve by central banks, just like today, except there will be no paper gold – no leasing, no futures, forex or swaps.

        gold will be owned by private citizens as savings. a nation that confiscates gold in such a system will see gold flee for safer places. it will be in the interest of the banks and government to have a free and secure market for trading physical gold. it will happen naturally as what we have now is simply untenable.

        • JM says:

          Hope is a way out of reality.

        • bungee says:

          You are calling for a deflation. Explain how that is even remotely politically feasible. Youre talking about the fed standing by as assets, including housing, go down down down and unemployment soars. The US will default and stop importing goods. Even the recent past shows that this is not what will happen. And in that unreal world, the banks will be allowed to go bankrupt as credit seizes? And then youre saying that a new gold standard will be ushered in. (With gold at a much lower price??) It may not be hope but its certainly not reality.
          Btw, is it physical assets go down or “dollars[…] will be depreciated”? Clashing definitions there.
          A new system with a higher gold price may not happen tomorrow. But its no fantasy.

        • JM says:


          Please do not change my comments in your answers.
          Nobody read on the crystal ball, but I can assume that the world governments will never allow a financial chaos but a controlled chaos where all the assets will lose value, in reality it has already been for many years but nobody wants to notice, maybe there will probably be an acceleration but nothing is sure in this game of world power where even a world war cannot be excluded, in which case when no one has the possibility to buy, all the assets will have no value, only the boxes of beans can still be exchanged with essential goods to survive. The US is no longer on a happy island as in World War II, where it could wage war far from its borders, new technologies guarantee immediate mutual destruction.
          Then again talk about assets, everything becomes very relative.

        • bungee says:

          I guess i just dont really know what you are saying then. When you say ‘lose value’ do you mean ‘price drop’? In otherwords a STRONGER dollar? Thats what i mean by deflation. I see how that may start, but only before a big inflation. And setting the private sector aside for now, what about the us government? Is it gonna start tightening its belt? Im not trying to put words in your mouth but pointing out that the deficits are soaring and im gonna be shocked if they turn around, and yes you are right – none of us knows the future.
          Also the foreign official AND foreign private purchases of treasuries is now negative. So as i see it, straight up debt monetization in our lives is a real possibility and one to prepare for. Because of this and many many other reasons i believe that, in such a scenario, gold will be a great way to carry wealth through space and time. Thank you.

        • bungee says:

          Actually JM thinking about it now…. I can see where i agree with your ‘assets losing value.’ PAPER assets of all kinds will deflate BUT they will be propped up by the fed/gov to achieve a ‘controlled chaos.’ Defaults are simply impossible because we need imports.
          Saving debtors will ultimately transfer the risk to the currency itself. And we will let the dollar slide as a way of walking down these assets.

        • JM says:

          Yes bungee, this is the way that generally takes the end of world empires.
          Saving capital becomes more difficult every day with a hidden inflation and officially denied where everything is manipulation of the truth and a continuous increase of taxation on all the assets that is accentuated in the near future, precious metals can be a certain salvation, not in the bank and other private organizations, but only if kept in an exclusive safe place that only you knows but long-term with a probable major loss but it is always better to have lost everything.
          You are not the only one to ask yourself these survival questions.

  12. Fed got a lot of mileage from “backing out” of the proposed rate hike program. The economy was heating up, and Fed wanted to cool it down. In 2008 the transmission mechanism was out of (their) control, private credit creation, (mortgages) and money growth was outstripping Fed’s ability to cope. Is corporate HY in the same bubble today? How would Fed react? More subsidies to corporate America? Energy is the canary, too much cheap debt, oversupply in oil and deflationary prices will lead equity markets lower. Fed has to return to the rate hike program, as Wolf says, what is their reason for cutting rates? The economy is strong.

    • Prairies says:

      I don’t buy the rate cut hype. The people calling for rate cuts are market manipulators and investors, the very people reliant on perpetual debt with limitless credit. People in this position need rate cuts to survive, but the numbers don’t show any real world need for rate cuts. I guess we will all find out in the next month or so.

      • James Levy says:

        The people making the decisions are not the technocratic disinterested parties they pretend to be–they are political operatives with ideological and class biases. They are not interested in “the real world.” They are interested in what their political and economic masters and constituents want done. If you think that Bernanke was going to work against the interests of Bush and the people who put him in the White House, or Yellen the same, or ditto Powell, you are being rather credulous.

        • I am with you on this, so then why didn’t Obama fire Bernanke? Are you really talking about ‘deep state’ interests and are these interests really promoting something other than the status quo?

        • Iamafan says:

          Probably doesn’t matter who’s in the White House now. Deficit is already 22 trillion, auctioning 1.2 trillion Treasuries this year alone. I think it’s looking like game over. No one wants to cut anything.

  13. tommy runner says:

    jp talked forbearance, then stepped back and watched a system that allows no bystanders from grandmas mortgage and pension to granddaughters school/auto loan, stimulate themselves (yeah, there’s another word for it). with no common goal or finish line just a vague belief in the ‘market’ as a bell weather maybe its time to just relax and realize these players are the same, they wear spiderman pjs and play with their poo at night.

  14. yngso says:

    However, and this thought always comes to me when there’s talk about jawboning and other types og manipulation, it’s all over when fundamentas show up in full force. The everything bubble will simply overhelm the central banksters with their smug hubris. They will of course try to put humpty dumpty together again, but every time they do that the structure becomes more fragile.

    • yngso says:

      I must double down on my comment above because I found an article called Central Banks Aren’t Really in Control of Interest Rates by Frank Shostak.

  15. Phoenix_Ikki says:

    I think Powell should try twitting from now on when it comes to future interest rate decision…just the FED verbiage is already building this much optimism, imagine daily twits from the FED in the same fashion as POTUS.

  16. Michael Engel says:

    – The restaurant sector that led the market up is slowing down lately, giving a bearish signal. This sector provide employment to millions of people, to low/ mid wages earners, the majority of the American people.
    It dominate cash spending in the black market.
    When people spend on restaurants, they also spend on doctors and pharma.
    Thus, eating out lifting up both RE & XLV, contributing to the GDP.
    – Tribute between China and other nations was done for centuries,
    lifting people from poverty, increasing trade between nations, in the Asia region.
    US & China exchanging friendly tribute (tariff) can help both countries.
    But communist China want things for free, because for decades US was
    a proven “mush”, until their bayonets hit a steel wall ==> the tech sector is paying the price.
    XLK sector is the heaviest @ 22%.
    FDN, the FANG ETF, that lifted the SPX to a new all time high, is trending down.
    GOOGL: SPX is moving down. GOOGL:FDN took a plunge.

  17. Jason says:

    “The Fed has already accomplished more with its verbiage this year than it had last time when it cut rates all the way to near-zero and did trillions of dollars of QE. And we’re seeing the first results.”

    I don’t think we can say that that is definitely the case.

    The markets move in mysterious ways. What people believe that they believe
    and what they actually believe could be two very different things.

    Furthermore, absence of action (continuing to raise rates) is an action itself.

    But I don’t think anyone with a brain seriously believes that the Powell Fed is going to cut rates in July with the SPX where it is.
    In that sense, either the market has accepted that rate cuts are not coming, or it is readying itself to make sure that rate cuts are coming. Take your pick.

  18. sunny129 says:

    The WEALTH EFFECT to stock mkts rise to stimulate the Economy?

    Barnake also talked of this effect, repeatedly pointing, how it has helped the to stimulate the Economy! Did it really?

    Fact is top1% own 45-50% of Equity+Bond Mkts at Wall ST. THe top 10% own the 80-90% and the bottom 90% (wage workers)own around 7% or less!

    Nearly 60-80% bottom 80% live from one pay check to the next. Very few even $400 for an emergency! How is the WEALTH effect channel through to these on the main street! In fact financial repression hurting the ordinary Joe/Janes, retirees, mom & pops out there

    It only helps those who have easy access to credit and promotes asset bubbles! Guess there is one economy for the top 20% and the other for the rest!

  19. Gershon says:

    As I’ve insisted all along, there’s no such thing as tapering a Ponzi.

  20. Iamafan says:

    I am not sure how all the signalling of the Fed will actually help except to temporarily reduce the interest rate of our out of control debt.
    Household debt can’t increase too much more without an income increase. People are already too much in debt. And the companies, most of them are just one rating step above junk. The next step is default.

  21. bc says:

    This is still confusing: The biggest issue–and the one that’s most difficult to explain in simple terms–is that mortgages have not been doing a good job of keeping pace with Treasury yields lately. This has happened for a variety of reasons. If we could only discuss one overarching reason, it would be that mortgages are based on different bonds than Treasuries. Although their supply/demand characteristics are usually almost perfectly similar, there are times when that correlation breaks down due to the unique underlying investments (i.e. one is US government debt and the other is consumer mortgage debt that’s merely guaranteed to be repaid by the US government).

  22. Augusto says:

    The investor, Howard Marks, commented in a recent newsletter, and I paraphrase, that he doesn’t understand and no one he has talked to understands why QE “worked”. His conclusion was that it worked because everyone believed it worked, but less so as different versions of QE2, QE3, etc…unfolded. Leaving open the possibility, that the belief next time might be it works less well or even makes things worse. Also, I suppose since much of QE’s aftermath (maybe that is all it is, “after math”, left over digits) still sits on central and commercial banks balance sheets, it may raise its head again some day, in some way, ugly head or otherwise?

  23. BC says:

    Ok, what-if there is stealth stimulus, and in time, rates drop towards zero and then an asset bubble is pumped, to a point, where stock and home values rise to new record heights, and as a result, the economy expands, GDP grows and things sort of get funneled into a state of synchronized global economic growth? Intuitively it seems as if a crash or recession are in-progress and increasingly likely events that historically “should” come about — but what if things head the other way, and we end up with some type of trump nirvana, where we see crazy prosperity? There are a lot of reasons to think the current cycle is about dead — and lots of unsustainable things going on, but what if we have a crazy White Swan Event, where the fat tail goes parabolic in the other direction? What am I missing, besides debt and credit problems?

  24. Andre says:

    proposing a causal relationship between the 10 year yield and fed speech is pure speculation. smth else may drive these yields lower.

  25. historicus says:

    Anyone notice that Central Bankers, who are supposed to be apolitical, are cattle driving everyone into a negative rate environment. And who benefits from a negative rate environment? The largest borrowers..governments.
    So we enter the upside down world where more debt begets lower interest rates, and negative rates. Debt becomes not a liability with negative rates but an asset from which to extract wealth from the holders of the currency.
    The governments win.

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