{"id":51992,"date":"2020-03-28T18:14:29","date_gmt":"2020-03-28T23:14:29","guid":{"rendered":"https:\/\/olduvai.ca\/?p=51992"},"modified":"2020-03-28T18:14:33","modified_gmt":"2020-03-28T23:14:33","slug":"weekly-commentary-the-solvency-problem","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=51992","title":{"rendered":"Weekly Commentary: The Solvency Problem"},"content":{"rendered":"\n<h3 class=\"wp-block-heading\"><a href=\"https:\/\/creditbubblebulletin.blogspot.com\/2020\/03\/weekly-commentary-solvency-problem.html\">Weekly Commentary: The Solvency Problem<\/a><\/h3>\n\n\n\n<p>Being an analyst of Credit and Bubbles over the past few decades has come with its share of challenges. Greater challenges await. I expect to dedicate the rest of my life to defending Capitalism. One of the great tragedies from the failure of this multi-decade monetary experiment will be the loss of faith in free market Capitalism \u2013 along with our institutions more generally.&nbsp;&nbsp;<\/p>\n\n\n\n<p>Somehow, we must convince younger generations that the culprit was unsound finance. And it\u2019s absolutely fixable. Deeply flawed, experimental central banking was fundamental to dysfunctional markets and resulting deep financial and economic structural impairment. The Scourge of Inflationism. If we just start learning from mistakes, we can get this ship headed in the right direction.<\/p>\n\n\n\n<p>Over the years, I\u2019ve argued for \u201crules-based\u201d central banking that would sharply limit the Federal Reserve\u2019s role both in the markets and real economy. The flaw in \u201cdiscretionary\u201d central banking was identified generations ago: One mistake leads invariably to only bigger blunders.&nbsp;&nbsp;<\/p>\n\n\n\n<p>What commenced with Alan Greenspan\u2019s market-supporting assurances of liquidity and asymmetric rate policy this week took a dreadful turn for the worse: Open-end QE, PMCCF, SMCCF, MMLF, CPFF, MSBLP, TALF\u2026 They\u2019re going to run short of acronyms. Our central bank has taken the plunge into buying corporate bond ETFs, with equities ETFs surely not far behind. The Fed\u2019s balance sheet expanded $586 billion \u2013 in a single week ($1.1 TN in four weeks!) \u2013 to a record $5.25 TN. Talk has the Fed\u2019s new \u201cMain Street Business Lending Program\u201d leveraging $400 billion of (this week\u2019s $2.2 TN) fiscal stimulus into a $4.0 TN lending operation. Having years back unwaveringly set forth, the ride down the slippery slope of inflationism has reached warp speed careening blindly toward a brick wall.\u00a0<\/p>\n\n\n\n<p>\u2026click on the above link to read the rest of the article\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Weekly Commentary: The Solvency Problem Being an analyst of Credit and Bubbles over the past few decades has come with its share of challenges. Greater challenges await. I expect to dedicate the rest of my life to defending Capitalism. One of the great tragedies from the failure of this multi-decade monetary experiment will be the [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[111,124,7756,303,426,3650],"class_list":["post-51992","post","type-post","status-publish","format-standard","hentry","category-economics","tag-capitalism","tag-central-banks","tag-credit-bubble-bulletin","tag-fed","tag-inflation","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/51992","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=51992"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/51992\/revisions"}],"predecessor-version":[{"id":51993,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/51992\/revisions\/51993"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=51992"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=51992"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=51992"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}