Monday, January 30, 2017

Will The Yellen Fed Cause a Trump Recession?


Ms. Janet Yellen. Fed Chair since Feb. 3rd 2014

The graph below explains the title of this post.

 Obviously, the Fed under Janet Yellen has been gradually decreasing the Monetary Base [MB], that is, the most narrow, generally considered most liquid, money supply figure, since at least the 3rd quarter of 2016:

Fig. 1: Federal Reserve Monetary Base, Non-Seasonally Adjusted, [Fed Chair J. Yellen], 
 January 2014 - December 2016, Millions of $'s, Log scale

Financial Safety Services Commentary:

Exactly What Does The Fed's  Monetary Tightening Mean?: 

It could mean that a recession, at the very least, is on the way during the new  presidents [Donald Trump] first term. [ Basically, a recession within an  ongoing recession/depression]. 

It is impossible to know for certain, and  the picture becomes ever more cloudy if we go back and look at the enormous monetary base  manipulations that have occurred since 2008 [ via Ms. Yellen's predecessor, Ben Bernanke]:


Fig. 2: Monetary Base [MB] , Millions of $'s, Non-Seasonally Adjusted, Federal Reserve, '07- Dec.2016, Log. Scale


Will this more recent tightening under Yellen have any effect on dampening the  effects of the massive Fed monetary base injections of the recent past? Maybe, maybe not. The longer the tightening continues, the more likely it is to actually have an effect and initiate a "Trump recession", in theory at least. 

Good News!

However, here is some good news: it is entirely unnecessary  for  you to have to try to predict/forecast future economic events from graphs [or similar], or to have to rely on [and pay] someone else to do that for you. 


A real world fact: the economic future cannot be accurately predicted via any graph, no matter who constructed it,  or what it claims to show. If you need to know why that is so, then for a very large fee, I can explain to you exactly why all graphs are useless for predicting future economic events.  :-)  

So, if you are worried about your own savings either because of, or despite what is revealed in these graphs/figures, here is some free advice on how to best protect your savings etc.

Regards, onebornfree.
 onebornfreeatyahoodotcom




Three More [Broader], Money Supply Graphs :

Fig. 3: M1 Money Supply, Non-Seasonally Adjusted,  Billions of $'s, Federal Reserve, '07- Dec.2016, Log. Scale



 Fig. 4: M2 Money Supply, Non-Seasonally Adjusted,  Billions of $'s, Federal Reserve, '07- Dec.2016, Log. Scale




Fig. 5: MZM Money Supply, Non-Seasonally Adjusted,  Billions of $'s, Federal Reserve, '07- Dec.2016, Log. Scale

Interest Rates: 




Fig. 6 U.S. 3 month Treasury Bill Interest Rates, January '07-December '16, Monthly Averages, 
Log scale

Fig. 7:U.S. 10 year Treasury Bond Interest Rates, January '07-December '16, Monthly Averages, 
Log scale.



 Fig. 8:U.S. 30 year Treasury Bond Interest Rates, January '07-December '16, Monthly Averages, 
Log scale.





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