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Jerome Powell’s Fed Euphemism of the Year – Organic Balance Sheet Growth

This is a syndicated repost published with the permission of Slope of Hope. To view original, click here. Opinions herein are not those of the Wall Street Examiner or Lee Adler. Reposting does not imply endorsement. The information presented is for educational or entertainment purposes and is not individual investment advice.

Out of yesterday’s entire Jerome Powell press conference, there was a single sentence which not only undid all the damage but also has been grating at me ever since. It is this: ” And we’re going to be assessing the question of when it will appropriate to resume the organic growth of our balance sheet.”

Just look at those words. Organic. Growth. Balance. It all sounds so natural and innocent, doesn’t it? Almost like something you’d be picking up at Whole Foods this evening, just between the coconut oil and white sesame seeds. The entire proposition feels wholesome and healthy.

My view is that it isn’t. If he instead said, “Even with the market at historic highs, we recognize that we’re about to plunge into a furious recession, so we’re going to conjure up trillions of more ‘dollars’ and throw them at our banker friends so that they can keep this circus going a while longer.” I guess that wouldn’t have had the same soothing effect, but it takes a lot longer.

In any case, yesterday was a massive “V” and last night we got a medium-sized “V”. It sure seems the market doesn’t know what to do with itself anymore. One the one hand, it is prone to selling off, recognizing reality and whatnot, and on the other hand, it is prone to defying gravity (now in its 11th spectacular year) thanks to QEinfinity.

I’m glad the Fed day is behind us, but the unfortunate reality is that these clowns are never going to leave our lives, and they’re never going to stop talking. However, the sheer violence of a move like yesterday is indeed in the rear view mirror, and now we can turn our attention to the far less predictable, far less scheduled, next chapter of the tragicomedy known as the US/China Trade War. I’ll bet you a case of Blue Moon that by the time October 15th rolls around, it’ll be back again, raging hotter than ever.

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