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IPFS News Link • Central Banks/Banking

"It's Not The Economy; It's The Central Banks, Stupid!"

• Zero Hedge

Authored by Bill Blain via MorningPorridge.com,

"Who's more foolish: the fool or the fool who follows him?

Central Banks have one real job: avoid inflation! It's here, and the consequences will be devasting as conventional rate-hiking wisdom is used to fight a wholly exogenous supply side shock. There may be alternatives, but "credibility" is everything to Central Banks.

May the Fourth be with you! It's Star Wars Day!

Which is kind of apt as the global economy feels like it's about to do a Death Star impression: exploding in a fireball of incandescent fury… all because someone skimped on the design of a monetary policy exhaust vent… You know the rest…

Central Banks – Its all about Central Banks

It's all about central banks this week. Today the Fed is set to raise rates by a "massive" 50 bp and announce plans to cut its balance sheet. Tomorrow the Bank of England might go full hog and also hike 50 bp (taking its benchmark rate to 1.25%, the highest since 2009) and announce its Quantitative Tightening Plans. (Forget the ECB for the time being…)