Recession Is Next & Rate Cuts Won’t Help, Here’s Why the Fed Has It All Wrong – Steve Hanke
Recession Is Next & Rate Cuts Won’t Help, Here’s Why the Fed Has It All Wrong – Steve Hanke
Kitco News: 9-19-2024
Michelle Makori, Lead Anchor and Editor-in-Chief at Kitco News, interviews Steve Hanke, Professor of Applied Economics at Johns Hopkins University.
Hanke weighs in on the Federal Reserve’s aggressive move to lower its benchmark rate by 50 basis points – the first cut since 2020.
Hanke criticizes the Fed, stating that the U.S. central bank is flying blind by ignoring the M2 money supply metric. He sees the Fed’s continued shrinking of the balance sheet as a contradiction to its oversized rate cut.
Hanke warns that the U.S. economy will enter a recession later this year or at the start of next year. He also projects the timing when the Fed will kick off its quantitative easing cycle and breaks down what it will mean for the U.S. equity market and commodities, including gold.
00:00 Coming Up
01:15 Introduction: The Fed
03:06 Analysis of the Fed's Rate Cut
06:09 Monetary Policy and Money Supply
08:11 Economic Outlook
10:36 Impact of Money Supply on Inflation Explained
17:21 Central Bank Policies
31:58 Fed's Actions
33:26 Economic Slowdown
34:59 Housing Market Trends
37:52 Equity Markets
39:56 Commodities & China
41:18 Gold Market Dynamics
43:58 Geopolitical Tensions and Market Implications