Let's discuss the relationship between tapering, Janet Yellen, Jerome Powell, and president Biden.
At long last the world presumes the Fed will finally taper.
"Fed officials are going to wait until the process of tapering is complete and then they will take on raising interest rates. They know that there will be a fiscal cliff come Labor Day. The last thing they want to do is pile on declining stock prices."https://t.co/4RdhhrBCUa— Danielle DiMartino Booth (@DiMartinoBooth) August 24, 2021
Aint markets great?— Stimpyz (@Stimpyz1) August 24, 2021
GOLDMAN SACHS SAYS RAISES ODDS ON US FEDERAL RESERVE TAPER ANNOUNCEMENT IN NOV TO 45% FROM 25%; LOWERS DEC CHANCES TO 35% FROM 55%
GOLDMAN SACHS SAYS EXPECTS A $15 BLN PER MEETING PACE OF TAPERING, SPLIT BETWEEN $10 BLN IN USTS AND $5BN IN MBS
Hike After Tapering Complete?
How long will that take?
What's far more likely - and scary - is that the Fed will continue to have to finance the deficit, and their balance sheet will go to many multiples of where it's at now.— Rudy Havenstein, mutating. (@RudyHavenstein) August 24, 2021
What About Fed Chair Jerome Powell?
Hey, thanks for asking.
Is her job to let Powell run all over her or it it her job to get in bed with him? Is there a difference?— Mike "Mish" Shedlock (@MishGEA) August 24, 2021
There is no independent Fed.
Powell will either hop into bed with Biden and Yellen or he will be replaced.
Real Troika: Powell (or replacement), Biden, Yellen https://t.co/NXRQdqmUya
What's the Troika?
My comment regarding the Troika pertains to a comment made by former Fed Chair Ben Bernanke.
He once stated the only three opinions that mattered were those of the Fed Chair, the Vice-Chair, and the President of the New York Fed.
Currently that would be Jerome Powell, Richard Clarida, and John Williams, respectively.
Given there is no independent Fed and Powell may be replaced if he does not go along with Biden Administration wishes, it is more realistic to think of the Troika as Powell, Treasury Secretary and former Fed Chair Janet Yellen, and President Biden.
"Powell will either hop into bed with Biden and Yellen or he will be replaced."
Progressives right now are putting pressure on Biden to replace Powell with someone more to their liking.
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