The New CS Board

[jumanji0881]

Ray Dalio warns the Fed’s hands are tied and that higher U.S. inflation is sticking around. Democracy, maybe not. : https://www.msn.com/en-us/money/markets/ray-dalio-warns-the-fed-s-hands-are-tied-and-that-higher-u-s-inflation-is-sticking-around-democracy-maybe-not/ar-AARQlYA?ocid=msedgntp

Excerpt:
MarketWatch: So you’re thinking that higher U.S. inflation is not transitory. It’s going to stick.

Dalio: Yes. There’s two types of inflation. There’s inflation when the demand for goods and services rises against the capacity to produce them. That’s normal, cyclical inflation. Then there’s monetary inflation — the creation of a lot of money and credit relative to the quantity of goods and services. The U.S. is having both.

When I look at the country’s financials going forward, what the size of the deficit will be and how much money is produced, that’s a concern. There’s also the risk, or even the probability, that those who are holding cash and bonds will choose to sell those to move into other things. If that happens, the U.S. central bank will have to decide if it raises interest rates, which will hurt the economy — and I don’t believe they can do that in a significant way. It would be bad for the economy, politics and the markets if they tried to rectify that by allowing interest rates to rise. So they’re probably going to have to print more money, and that causes more monetary inflation.