With the Fed's Head, Janet Yellen announcing yesterday that the Federal Reserve is easing Quantitative Easing by another $10B a month starting in April (Going from $65B to $55B) and a promise to continue easing through early fall; we can expect to see some weakening of the economy further.
I was never a fan of QEing in the beginning as it just kicks the can down the road not unlike putting off that cancerous brain tumor operation another year or so. Or my favorite analogy of getting the economy hooked on heroin and now having to wean the economy back off of the heron. Regardless the end is not going to be pretty.
David Stockman in an interview with
CNBC yesterday basically said what I have written above in that:
"We never should have painted ourselves so deep in this QE corner in the first place," chides David Stockman, "because the whole predicate [of Fed policy] is false... "We are already at peak debt and forcing more into the economy didn't work," and won't work as is merely funds Wall Street's latest carry trade to nowhere and fiscal irresponsibility in Washington. Simply put, "the private credit channel of monetary transmission is busted," so the Fed is exploiting the only channel it has left - "the bubble channel."
Scroll down on that hyperlink above to watch the 3 minute interview - OUCH!
So where does this all lead you ask...Here are some of my thoughts:
> Lower stock market which lost 114 points yesterday based on Yellen's announcement (back up today)
> A possible financial attack by Russia & China where they dump US Treasuries. If you think this is far
fetched - Russia put pressure on China to do just that in 2008 as was reported by
The Blaze and the
BBC confirmed by Former Sec. of the Treasure Paulson.
> Inflation in the high single digit to low teens
> Interest rate hikes not seen since the Jimmy Carter years - Low to high teens
> A renewed higher unemployment rate (I look at the U6 rate)
Then throw in the following:
> Man made drought in CA. which is where we receive 20% of our food from
> Higher energy costs thanks to Russia's expansion, the continuing strife in the Middle East and the failure
of Presidents Obama's administration opening up more oil and gas exploration
> The November mid-term elections
> A inevitable correction in the stock market
> Stagnate US
ofA economy with a less than 1% GDP
> Higher U6 unemployment rates
> $17.7T national debt with a $210T unlimited liability due in part to retirement plans (Promises)
>
What have I missed?IMO, I would get those Beans, Band-Aids and Bullets bought and plans tweaked.
With this all said,
what do you think is going to happen by year end? 
