Last week, I wrote that in its quest to defeat inflation, the Federal Reserve wants to make investors like us poorer. The “wealth effect” says happy and bullish investors tend to spend more money than sad and bearish ones. So, as far as the Fed is concerned, plummeting portfolio values are a good thing. But that’s only part of the story…
Over the weekend, it sounds like Federal Reserve Chairman Jerome Powell also received a call to his principal’s office … this one belonging to President Biden. But I’m fairly sure that Powell isn’t being recognized as central banker of the quarter. Ahead of midterm elections, Biden is reaching for anything that can be done to tame inflation. And unfortunately for us all, there is only one thing Powell can do…
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