I expect Goldilocks to be temporary, maybe very temporary because typically when the Fed halts a rate hike regime that is when troubles brewing beneath the surface..
Many articles and pundits will say that SVB collapsed due to lack of risk managment or insuffiecient regulation. But the root cause of SVB (and other bank failures) is much scarier than hoping the problem is unique to SVB.
No asset is "risk free." That is a marketing term coined by Wall Street bankers and bureaucrats to peddle debt backed by the "full faith and credit" of our now hopelessly insolvent Uncle Sam.
The more they say they are working to make sure there won’t be any contagion, the more you know there will be. The fact is there is already contagion and lots of it.
That is how these big bust events happen every time! They burst on the scenes so big that we are already hearing the bailout bastards beg for help again..
I was writing over a year ago that Powell would not stop till he got to 5% fed funds and 5% unemployment? We are going to get to that 5% fed funds a lot sooner than we get to 5% unemployment.
