Deer Point Macro joins the podcast to discuss his view that the U.S. Federal Reserve will only hike interest rates once more before easing.
- The Fed is not some magical organization that can control all parts of monetary economics (2:50);
- The Fed can create demand for credit, but banks have to provide supply. And banks are pushing back (5:03);
- What to make of the Fed’s rate hikes this year? How has that affected bank portfolios? (9:37);
- The eurodollar market plays a significant role in Fed policy and its implications. An explanation (13:24);
- The Fed stands to raise once more, at its next meeting in July, before having to cut rates in September (16:21);
- Inflation is stubbornly persistent. Doesn’t this force the Fed to raise rates? (19:57);
- Background on the guest (30:14);
- Markets don’t really react to ADP employment data, but for economic detective work it can be vitally important (31:48);
- How this all translates to asset prices: good for bonds but commercial banks are maybe not as safe as some would think. But regional banks may be a better bet (35:11);
- What about cryptocurrencies? (36:34);
- Quick discourse on the so-called ‘Fisher effect’ that posits that inflation rises as Fed funds increase — over the long term (39:14).