The Fed: Damned If They Do AND If They Don't.

On my best day, I'm at the very least a Federal Reserve blood enemy: how I positively loathe their persistent lack of political accountability, not to mention successive presidents and congressional leadership who go out of their way to let them be.

These serial incompetents have done what The Fed has mostly always done: destroyed an otherwise healthy American economy. In this instance, via the economic insanity of QE, that mother of all inflation creation machines. They're quite literally hollowing out the middle class, not to mention decimating the poor.

Meanwhile, these paragons of sound economics and monetary policy profit continuously by being in the market that they themselves quite deliberately inflated via QE. Beyond despicable while the bought and paid for in DC ever conveniently look the other way.

So human abject misery begins with them as their digital money creating machine sends inflation spiraling out of control. It ain't at a bullshit 9%, it's more like at 15 to 20%.

This is where Fed damnation begins: they can panic and hike rates with a series of at least 75 basis point rises, or they can start and then suddenly chicken out and reverse course. You know, those upcoming midterms.

Option One throws an already fragile economy into official recession with the 10 year yield spiking up precipitously.  That means above 3% at minimum. Not good. Guess what, it'll sink the bond market and then down goes the rest.

Contrast that with chickening out, which they'll do, again for political reasons. You know, those midterms.

Breaking the back of inflation always means raising rates above the inflation rate. That's why Volcker went to 18%. There's no way Powell and company will do that here. No fucking way.

So, inflation is on-board for the duration as it continues to steadily rise. When it finally naturally begins to abate, not anytime soon, in will come a  deflationary bust that'll make 1929 look like a pleasant walk in the park.

In short, they goosed markets to make themselves a lot richer while destroying pretty much everyone else. Damned if they do and if they don't. Put another way, there's no possible good outcomes thanks to the collective incompetence of those chaletans at The Fed. After all, faking it till they don't make it is their only stock in trade...