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Senior Advisor

The Fed

https://wolfstreet.com/2020/05/08/fed-cuts-qe-helicopter-money-for-wall-street-further-still-hasnt-b...

Certainly found plenty of things to spend $Ts on but did not buy stock ETFs as they'd threatened. Although stock investors are the easiest herd of wildebeests to stampede that there is.

All it takes is an implied put under the market. Although I wouldn't sell them short- the 12/18 low in stocks coincided with when Mnuchin very publicly assembled the Plunge Protection Team and gave da boyz the wink and nod.

But the 'rona holds the high cards here.

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Advisor

Re: The Fed

That disconnect thingee:

interesting observation on the younger quarter* or so:

https://www.google.com/amp/s/www.esquire.com/news-politics/politics/amp32417197/20-million-unemploye...


* Exceptin’  for Jim O’Keefe, Jacob Wohl, Ben Shapiro and, of course, noed pugilist Tyler Durden.

 

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Senior Advisor

Re: The Fed

https://www.newyorkfed.org/research/policy/nowcast.html

NY Fed now Nowcast currently at -31% for Q2, a bit below the "consensus".

So if we have two roaring hot quarters of +10 to finish the year, then output will only be down 15% yoy. Which I don't believe it ever has.

Get in on the ground floor.

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Senior Advisor

Re: The Fed

The economy is like the 'rona- so far betting the over has always been right.

There's a normalcy bias at play here. Can't be this bad. Gotta be some magic bullet.

If that's the case then "the market" is going to have an oh ***** moment sometime but it can keep going up for a while, just like when it was floating up on Fed cash in February when the iceberg was in full view.

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Advisor

Re: The Fed

Nagging problem “coming out the back door” may well be that there aren’t speculative vehicles for any number of activities that will be involved in “recovery”, such as that may be. 

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Senior Advisor

Re: The Fed

I said that in the future I'd move this stuff to the Farm Business page. But anyway

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Highlighted
Senior Advisor

Re: The Fed

Point being, that even if employment snaps back sharply (and the 'rona makes that call*) it is unlikely to be better than the worst of the '08-'11 recession for many quarters.

There are so many places where damage has already been done no matter how much money is poured in.

Like I said, get in on the ground floor. Problem is that the Fed has already lifted the ground floor, which is what I think you were alluding to.

*thus, current trends are not encouraging.

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