SliderOnTheBlack.com

The Fed just wasted a rate cut yesterday. A “hold” would have been more positively accepted by the market, would have let more speculative air out of oil prices, and would be one less rate hike they need to do later.

But, the larger problem with the U.S. Central Bank is their dual mandate.

You can’t have a dual mandate of maximum growth with full employment, and achieve price stability at the same time.

Not to mention, standing ever-ready to place a “Free Put” under the stock market.

In contrast look at the ECB and the Euro Dollar.

If the U.S. Dollar would have merely held parity with the Euro, Oil would be $70 today and not $120.

The dual mandate of the U.S. Central Bank continually leads to boom and bust cycles, where only Wall Street bankers, and insiders prosper.

Wall Street skimmed billions off of the tech & internet bubble of the late 1990’s from “irrational exhuberance” - until the ultimate bust in March 2000.

And they skimmed billions again, during this housing, credit, and derivatives bubble.
Murray Rothbard taught that with inflation: “he who get’s the money first - wins.”

A lesson that Wall Street has learned very well. Let’s hope that Main Street will catch on this time.

And concerning the ongoing debate of inflation vs. deflation…

Here’s a chart on the most widely accepted measurement of money supply, M2. Look how accurately the turn in March coincided with the top in gold:

Wall Street finally noticed that headline inflation was crushing the heartland. Next, they will discover that negative real rates — matter.

– SliderOnTheBlack