Hey guys, it's Sasha The US Federal Reserve has just said that they want to increase rates further, potentially quite a bit Further, two members of the Fomc committee that decides on interest rates have just come out and said that they want to increase rates at the next meeting. and boy, do I have some thoughts to share on this, but the language required to express those thoughts accurately will get this video demonetized if I crack the whip too early. So I'm going to have to Pander to the algorithm and tell you what I really think in a minute? Increases of the last year have taken interest rates from just above zero percent to 5.25 as it is right now. and because the rate started at zero and went up so fast, the nasty side effects are already on the way and showing in every single part of the economy.

Four U.S banks have now collapsed because the sharp rate increases destroyed the value of bonds sitting on their balance sheet. The management suck too, but the combined size of the banks that have collapsed so far this year is already bigger than the total size of all the bank the collapsed during the financial crisis in 2008. But that doesn't really matter because the Feds made to JP Morgan got a sweet deal on buying a buying without having to do it any due diligence or take on any of the risk. And now as the FED is over tightening by a massive amount, the U.S housing market is starting to crash in the last quarter.

house prices decline that the fastest rate in The last 60 years. And the reason for this is that the economy this defense over tightening which means the mortgage rates have exploded and have now become unaffordable. So today, Lori Logan The President of the Dallas Fed said that she thinks the current data does not justify pausing rate hikes yet, and she thinks that the FED should increase rates again at the next meeting in June and then again afterwards. In case you're wondering what specific credentials she has, Lori has never had a real job and has only ever worked for the FED starting out as an analyst in 1999.

The reason this is extremely important because this is one of the people who makes extremely important decisions affecting real people, affecting real businesses right across the country. Decisions that impact the ability of those business is to function to employ people to pay their bills to survive. She has never actually worked in any business and she has never been impacted by one of these decisions. She has never managed an actual business budget because she is a lifer in pushing papers at the Fed.

and today she gave a speech to Bankers in San Antonio lecturing the world because there is nothing that these Fed leeches like doing more than giving speeches to Bankers instead of doing their job and actually studying the data. She said that we haven't yet made the progress we need to make and it's a long way from here to two percent inflation because inflation coming all the way down from 9.1 to 4.9 is of course not meaningful in any way. It's way better to completely go berserk way too hard, crash the economy everyone's jobs and cause deflation, then properly manage and guide inflation down to that two percent level because that would be way too sensible. on Monday Another member of this clown troop Raphael Bostic said that he doesn't see any possibility of raid Cuts this year and even if the economy crashes, even the U.S economy goes down the theater, the FED overshoots on the rate increases makes everything better.

It doesn't matter, but in an interview on CNBC this guy said that he thinks that race should increase a little further. If I had a bias between going up and going down as our next action I would say we might have to go up. My Baseline case is we won't really be thinking about cutting till well into 2024. Uh, just in case you're wondering about this guy's credentials, it just so happens that he too has never had a proper job, has never worked in finance, never worked in a bank, never worked in an actual business.

After studying first, PSG Bostick immediately joined the Federal Reserve Bank of Atlanta and then spent some time in Academia and Think Tanks before coming back to Atlanta to become president of the Fed. So here we have another lifer who likes attending Banker conferences and discussing Theory who has got exactly zero Real World experience has never been affected by any of the decisions that he now gets to make. And since they're discussing policy because it's fun and interesting. and here is the dumbest part.

These dimwits from the FED who completely missed inflation going up for over a year are now sitting here educating us or telling us slow people on how they know best how to manage the inflation down. They are experts. the same clowns who said that inflation would 100 for sure, no doubt about it, go down all by itself all through 2021 are now telling you that they really know they have to keep hiking interest rates because there is no other way. And trust them, They, after all, are the experts and for some peculiar reason we have to listen to these idiots and pretend their opinion matters in any way whatsoever.

Well, it does matter because they get to make the decisions the all of us. but the same tweeto dumps who spend 2021 cutting a hole in the bottom of the boat out of their Infinite Wisdom are now telling you that they know the best way to get water out of the boat that mysteriously appeared at the bottom out of absolutely nowhere. Who could have predicted this? And as it stands, we now have a very real possibility that the very same people will be giving interviews to CNBC later this year or maybe next year. Saying nobody could have predicted that the high interest rates that have gone up way too fast because of their incompetence would crash the economy cause job losses and deflation.

But I am sure that after up twice in a row by getting it completely wrong, they will have an entirely robust plan on how to tackle the situation. and maybe you know Sprint a whole load of extra money, go and drop rates back down to zero to try and resuscitate the economy because if you listen to these guys talk and they really do go ahead and increase rates another 75 or 100 basis points in the next two or three meetings. As these two presidents are openly suggesting, this is exactly what may happen. And the Really perverse thing is that at the same time as all of this is happening as businesses are told to tighten their belts as they have to reign in their spending as their situation becomes more difficult as they have to refuse people wage increases even though those people can't afford their bills as the cost of borrowing skyrockets.

At the same time, the US government is busy negotiating a huge increase to the death seeding so that they can continue running a 37 deficit and pass legislation like the Inflation Reduction Act which will cost 1.2 trillion dollars in subsidies. but because nothing kills inflation faster than a record level of spending on for no particular reason and the people watching this unfold are losing confidence. according to a Gallup poll that just got published, Jerome Powell's approval rating has now collapsed to 36, which is lower than Janet Yellen when she was chair of the FED lower than anyone lower than Ben Bernanke when he was chair of the FED during a financial crisis. At the same time, Joe Biden has a confidence rating of 35 in being able to manage the economy which is almost as low as George Bush at the peak of the financial crisis.

And it really does not come as a surprise because this current bunch of old age pensioners playing politics have set new records in incompetence. As I am recording this video, the Senate banking, Housing and Urban Affairs committee is holding a hearing on how regulation has to change to stop more Banks collapsing. And again, this is so typical of how the US government apparatus Works instead of trying to preempt issues you know, fix things before they break and nip them in the bud. the legislators would much rather wait for to hit the fan.

and then they can hold endless hearings, have committee meetings to try and push blame around. Maybe pass some new legislation years too late? Maybe just maybe they shouldn't have canceled the regulations that were already in place that could have prevented these Banks from collapsing. Do you know what one of the very first things that Jerome Powell did when he became chair of the Fed? Well, he got rid of the oversight and regulation for regional banks that was in place after the financial crash in 2008. Federal Reserve Chairman: Jerome Powell Used his first appearance before the Senate Banking Committee to endorse the main features of a financial deregulation bill that the Senate is set to debate on the floor next week.

Powell Told the panel Thursday that the most significant provision in the bill is the replacement of the Dodd-Frank threshold for stringent Fed regulation of banks. The 2010. Frank law put the threshold of 50 billion dollars in assets. The bill would raise that to 250 billion and reduce the number of banks affected from 44 to 13..

the same guy then went and increased rates way too late and way too fast and caused those same banks that he just deregulated to collapse because they didn't have to do the things they used to have to do. And there are a bunch of witnesses speaking at the Senate committee meeting is Jerome Powell there. No, of course not. The guy who is responsible for this whole thing up is of course not going to be scrutinizing anyway for why he removed regulation for no reason in the first place, are any of the Fomc members that are causing all of this going to testify? No, Even though these are the clowns who did not think about the impact of their actions, the impact of the increases coming too late and too fast on basic things like bank balance sheets.

Instead, the Feder sent Michael Barr the vice chair for supervision. Whoever that is, because the bigwigs, the actual guys sitting in that room making decisions do not want anything to do with it. They don't want to be associated with it. They don't want to admit that they got it badly wrong.

The next Fomc meeting happens in four weeks time, just after the main inflation data is published in the middle of June Why the actual: are the members of that committee now going around giving speeches, a banker event, and going on CNBC sharing their view on raid policy before seeing and analyzing the data. Do they really have that much spare time in their day that there is nothing better that they could be doing I Don't know, maybe their actual jobs. What happens if these unguarded comments made by these guys made for personal political gain, negatively impact the economy? Are there going to be in any way liable? No. Two-year treasury notes have now increased substantially over the past week because the US government is too busy playing politics instead of doing their job and managing their debt ceiling in the UK The bank of England Governor is blaming the wage price spiral for the UK's massive inflation problem.

He's not blaming Brexit, which is the UK economy is not blaming himself for being a year too late to increase interest rates in the first place just like the US And he's not blaming the UK government for having no coherent policy at all on managing the economy. Slightly different story in the UK because the UK up way worse than even the US didn't know. hard to believe, but exactly the same process of passing the buck and avoiding any semblance of responsibility of being massively incompetent by every single person whose job it was to manage the economy and prevent a financial meltdown. The good news is that the stock market seems to have learned to ignore the FED Now the boy has cried wolf a few too many times this morning.

S P 500 is up, and exactly nobody gives a whether the FED wants to increase rates, not increase rates. It doesn't matter anymore. A few months ago, a Jerome Powell sneeze could send the entire Market into a downward spiral, but now the market seemed to have built some kind of a immunity because the marketplace is way more value on the actual underlying fundamentals, the performance of companies, the performance of the economy than it does on a bunch of morons who have never had a proper job, giving speeches and teaching everyone what they think. And eventually it won't matter what some random numpty thinks about interest rates and inflation, all of these people from the Fomc are enjoying their five minutes in the Limelight.

They're so popular right now. they get invited onto CNBC Everyone seems to care what they think, even though they can't tell their ass from their elbow. they get to spout whatever nonsense they feel like spouting and everyone listens. But as inflation subsides, the US economic Powerhouse will take over.

as it always does. The FED will be forced to stop the rate hikes and then reverse them. And before you know it, the good times will roll in and all of these Tweedle dumps will go right back. Into Obscurity Where they belong Where precisely nobody cares what they think or why they think it and they won't have the tools to the economy for personal political gain at that point.

and all of the data is pointing to that happening sooner rather than later. If you found this video useful, you should watch this one with a lot more detail on U.S Inflation as it stands. And don't forget to smash the like button for the YouTube algorithm. Thank you so much for watching and I'll see you later.

Thank you.