I still maintain no one will mark June 16th, 2021 as the day the world changed. Watching the dollar surge into this weekend thanks to a breakdown in the euro only validates that conclusion in my mind.
Remember, on June 16th Presidents Biden and Putin met for a summit which altered the course of geopolitics forever, agreeing to disagree about Nordstream 2 and reversing the worst of U.S./Russian relations among other things.
While that was happening the FOMC met and reversed the flow of dollars globally.
I told my Patrons something was up on June 18th. Then I did 2 hours worth of podcasts on it (here, here, and here) after thinking it through. Finally, after fully digesting it I wrapped it all up in a lengthy post on July 3rd.
The Fed’s decision to pay 5 basis point on Reverse Repos was the subtlest but most effective way to taper without tapering, tighten without tightening and undermine the WEF’s Great Reset while seemingly still supporting it.
I can hear the howls from the gallery who think otherwise so I’ll address them first.
Yes, normie macro-guys, the bond market has been screaming at the Fed that inflation is soaring and they need to raise rates.
Yes, first year domestic policy students, the Fed looks like it is putting pressure on Republicans to cave to Nancy Pelosi’s hardball over the Infrastructure, Budget and Debt Ceiling deadlock, so far to no avail.
Yes, second year geopolitics students, the Fed is forcing China to respond to soaring commodity prices while simultaneously trying to defend the yuan.
Yes, these are all effects of the Fed’s move in June.
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