Last week was a fascinating pivotal week in the financial world. The bond market no longer functions as a normal market. That was demonstrated when a Wall Street Journal reporter doing a Q&A session with Jerome Powell asked him whether the Fed will take action to stop ten year bonds going up. When he said no, he asked again to try to get him to say yes, because at this point the reporter believes that a free market in long-term bonds has to stop in order to prevent stock market losses, even if he never intellectually articulated that need to himself, he needs it no matter the consequences.
The Federal Reserve within weeks or months will have to begin measures to freeze long-term Treasury bond yields. If the stock market falters this year investors both small and big will demand action and even crave it to make their stocks go up even though it will mean rising inflation and even hurt to themselves. The elites are bullies, and those look up to them emulate them, and rarely in a world of bullies can anyone say they are sorry.
They didn’t in 2008.
That was a theme of my Friday email news headlines… but hey a Friday rally day makes people think everything is a-ok……