https://www.investors.com/market-trend/stock-market-today/do… Fed Gov. Lael Brainard said Tuesday that she wants the central bank to start to reduce its massive balance sheet soon and at a "rapid pace." Brainard, who's been nominated to become the Fed Vice Chair, added, "I expect the balance sheet to shrink considerably more rapidly than in the previous recovery."
Fed chief Jerome Powell has signaled for some time that policymakers would start to reduce its balance sheet, but Brainard's comments signaled that it'll likely come soon. Brainard had been seen as slightly more dovish than Powell, but in 2022 there are no doves. On top of the balance sheet cuts, markets have been pricing in expectations for half-point hikes at each of the next three meetings.
Fed Gov. Lael Brainard said Tuesday that she wants the central bank to start to reduce its massive balance sheet soon and at a “rapid pace.” Brainard, who’s been nominated to become the Fed Vice Chair, added, “I expect the balance sheet to shrink considerably more rapidly than in the previous recovery.”
Fed Gov. Lael Brainard said Tuesday that she wants the central bank to start to reduce its massive balance sheet soon and at a “rapid pace.” Brainard, who’s been nominated to become the Fed Vice Chair, added, “I expect the balance sheet to shrink considerably more rapidly than in the previous recovery.”
The FED mechanism for raising rates is buying bonds. This means a rapid appreciation in the USD. This is excellent for savers and consumers.
We are getting solidly into a period of disinflation. Followed by a much more modest post pandemic inflation rate. The demand in the economy intensified by fiscal policy will mean very high GDP growth rates long term.
While demand side economics has been vilified for decades by total fools, demand side economics is the best of all worlds for the US.