Except these moles have real-world consequences.
All the economic chaos that has happened and continues to happen can be traced back to the triggering event of COVID stimulus.
$5T poured into the money supply that started the whack-a-mole game.
Oh, economic activity is way down?
We better whack that mole with some stimulus.
Now there’s inflation?
Increased interest rates should help whack that mole.
– Banks purchasing excessive securities with their influx of deposits
– New FED credit facility rolled out after the Silicon Valley bank failure
– Mortgage issues with First Republic’s loans to high-net-worth individuals
All just moles popping up and attempts to whack them.
But the biggest issue with this whack-a-mole game is that no one knows when it will end—or IF it will truly end.
$5T is A LOT of inflation to deal with.
It’s going to take time to get it under control.
Until then,
The whack-a-mole game goes on.
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Digging deep on banks is what I do.
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