'The Chairman’s rambling (non-answer) reply could be summarized in four words: “The Fed is trapped.” It’s trapped by Bubble Dynamics – a historic Bubble that either inflates or collapses. What the Fed labels as “markets functioning” is at this point a “functioning” speculative Bubble. And feeding this dynamic exacerbates inequality, social instability and financial and economic fragility.''
June 19 – CNBC (Berkeley Lovelace Jr.): “White House health advisor Dr. Anthony Fauci said Friday that he is frustrated Americans aren’t following recommended health guidelines to prevent the spread of the coronavirus. ‘Clearly, we have not succeeded in getting the public as a whole uniformly to respond in a way that is a sound scientific, public health and medical situation,’ Fauci, director of the National Institute of Allergy and Infectious Diseases, told CBS News… ‘And it’s unfortunate. And it’s frustrating.’”..
India reported a record 14,574 new cases Friday.
Beijing goes to “wartime” footing with a 100-case outbreak. The U.S. on Friday reported 33,000 new infections, the largest increase in weeks. Expectations that our outbreak would follow the path of Italy, Spain and Germany were much too optimistic. The U.S. “curve” not only hasn’t declined as expected, it is turning higher. But there will be no U.S. mobilization. Former FDA Commissioner Dr. Scott Gottlieb asked the pertinent question Thursday on CNBC: “Can we keep this from getting out of control. This is a virus that wants to infect a very large portion of the population.”
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The pandemic is worsening – at home and abroad. Here in the U.S., states will be hesitant to reimpose lockdowns. Yet it’s difficult for me to see how deteriorating conditions in many states – including large ones – don’t come with serious economic ramifications. A return to normalcy will be postponed. Consumers will remain hesitant to venture far from home. Recovery for scores of businesses will be further delayed. Lockdown or otherwise, a virus resurgence would equate to more business failures, permanent job losses and Credit problems.
Brazil has a population of 210 million. India is approaching 1.4 billion. Both nations are staring at potential health and economic catastrophes. With a record 180,000 new global infections reported Friday, scores of countries are at risk of the pandemic spiraling out of control. When it comes to global recovery prospects, markets are much too complacent.
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..China’s Bubble is faltering. Inflated consumer confidence has fallen back to earth, portending an extended period of weak domestic demand. Meanwhile, China’s manufacturers remain highly exposed to ongoing weak global demand.
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The Chairman’s rambling (non-answer) reply could be summarized in four words: “The Fed is trapped.” It’s trapped by Bubble Dynamics – a historic Bubble that either inflates or collapses. What the Fed labels as “markets functioning” is at this point a “functioning” speculative Bubble. And feeding this dynamic exacerbates inequality, social instability and financial and economic fragility.
The Fed “pursuing financial stability”? It’s difficult to imagine a backdrop with greater instability. At this faltering Bubble phase, throwing Trillions at efforts to aggressively pursue employment and inflation mandates essentially destroys the prospect for any semblance of financial stability.'
- Doug Noland,
Update COVID-19, June 20, 2020
Context'Reviewing the Fed's Q1 Z.1 report, I was thinking this is how things look as a system self-destructs. Q2 will be worse.'(Banking Reform - English/Dutch) '..a truly stable financial and monetary system for the twenty-first century..'