Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

The Turn

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The two important headlines I saw today both came from Our Dear Leader Powell.  In his testimony today, Chairman Powell declared that “It is time to retire the word transitory regarding inflation”, and “the threat of persistently higher inflation has grown.”  Finally, he added that the Fed “can consider wrapping up the taper a few months sooner.

The fact that inflation is here is no shock to the average American, but to hear it come out of the Fed Chairman’s mouth was a bit shocking today.  Also, the idea of speeding up the taper has not been priced into markets.  I believe soon we’ll be hearing Chairman Powell begin to broach the topic of raising interest rates sooner than expected as well.

So, what does this mean for markets going forward, and are we at a key turning point?  If the Fed is now moving to a stance of acknowledging a persistent inflation problem, logic would dictate that a policy response would follow.


Happy 34th Deathday

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A moment of silence, please:

It was 34 years ago today that the market crashed, which prompted the government to “help” everyone and begin the slow, merciless strangulation of natural, organic, capitalist equity markets. People used to bitch and moan about how markets have always been manipulated, but pre-1987 traders honestly had no clue how good they had it. I would give anything to have a market like that again, instead of this clown-show we have every day. Amen.

Woven Like a Noose

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I don’t think a single person here needs any more evidence that the Fed is totally, completely, and utterly in control of equity markets. All the same, I wanted to show you a couple of dual SlopeCharts to help drive this point home.

This first one shows the total Fed assets (a figure which used to linger in the lower hundreds of billions and was used to tweak things now and then, but now has grown into a laughable nearly $9 trillion slush fund). You can see how the financial crisis in 2008 was met with an enormous heroin-shot of asset purchases, which at the time took months to take effect.