Trillions added to our national debt; can’t let interest rates return to natural rate—ever. @DavidBahnsen

Jun 11, 2020, 03:09 AM
Image:  Newspaper clipping USA, Woodrow Wilson signs creation of the Federal Reserve. Date: 24 December 1913

David Bahnsen, CIO, Bahnsen Group,  in re: The Fed will “do whatever it takes” to . . .  stabilize the economy.  Same as what he’s been saying.   A put option/safety valve for risk.   Keep interest rates at zero till 2022.  After 2017, ’twas almost 2017 before they raised interest rates. You can’t just unwind; a society grows addicted to low interest rates.  Problem is we added several trillions to our national debt; thus cannot let interest rates return to natural interest rate—ever. Case in point: Japan for the last 30 years. Academic economists make mistakes all the time; that’s all right except they pretend they're infallible.  The May jobs number was about employees’s being laid off, not fired; academic  economists were wrong.  The PPP program has been underrated for its efficacy. My guess is that we’ll have less unemployment than 9.5%.