As the Guardian reports this morning:
Fears about a possible recession have pounded stock markets around the world amid reports that US Federal Reserve could raise interest rates by as much as 0.75% this week – its biggest single hike in borrowing costs for nearly 30 years.
As Wall Street's benchmark S&P 500 index fell almost 4% on Monday into bear territory, prompting selloffs from Sydney to Shanghai, US central bank policy makers will begin a two-day meeting on Tuesday with expectations mounting that they will lift rates by at least 0.50%.
This is only the seventh bear market since 1945, so this is economically significant.
So too is the Fed's reckless path that is not stopping inflation, but is driving up the dollar, is threatening recession and will create massive poverty in countries that have debts denominated in dollars - about whom the Fed seems to be utterly indifferent as if running a reserve currency is an issue of no consequence for it.
Simultaneously, the Fed is providing cover for those on the UK Monetary Policy Committee seeking to impose maximum hardship on the UK when, once again, interest rises can only increase the economic problems that we face, and solve none.
It's as if some people wanted a disaster.
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It is a disaster for ordinary people.
But a bonanza for the rentiers.
It’s how they change a bear market into a bull.
Whether Democrat or Republican, Americans are Americans it seems, making sure that the world shares its problems and effectively off shoring its burdens through the dollar. Financial imperialism still rules.
If your only tool is a hammer every problem looks like a nail.
Are we identifying the Fed and Congress as seperate disconnected entities?
Why not?
Like the U.K. gov’t and BoE
Government slashes spending and GDP shrinks. Shock Horror!! How could we have known that?
Just read an article in the Torygraph which was basically exactly that. Why is it a ‘surprise slump in GDP’ to City economists when you and others have been saying it for months?
The fact inflation was low from the 1990s until last year has nothing to do with central bank independence. That was just a coincidence. It has everything to do with China (and other countries) being a huge source of cheap goods and the resulting off-shoring of so much production. That has abruptly gone into reverse.
Government slashes spending and GDP shrinks. Shock Horror!! How could we have known that?
Just read an article in the Torygraph which was basically exactly that. Why is it a ‘surprise slump in GDP’ to City economists when you and others have been saying it for months?
The fact inflation was low from the 1990s until last year has nothing to do with central bank independence. That was just a coincidence. It has everything to do with China (and other countries) being a huge source of cheap goods and the resulting off-shoring of so much production. That has abruptly gone into reverse.