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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

https://www.youtube.com/watch?v=rCnCSDuXWvE