There’s a massive recession on the way that will strike in 2023, of that I am about as certain as I can possibly be.
Normally, I keep my options open, and of course, I stand ready to be surprised if a recession doesn’t materialize, but the chances of being wrong here are so low as to be ignorable.
Note: This is a purely written piece, taking me back to my roots. So, no video anywhere below. For those of you who are new, this was my most typical form of communicating with everyone for many years. Also, if you find this topic interesting, you’re going to want to be sure to attend the yearly seminar on Jan. 28 & 29.
This recession also has the chance to be exceptionally deep and damaging because so much of the froth being taken out of the economy was pure monetary fiction.
In other words, a plain old, garden variety bubble burst. Easy come, harder go. Bubbles are fun on the way up and very painful on the way down.
To have a bubble you need two things and two things only.
- Ample and easy credit
- An accompanying story
The Fed, because of their activist approach to trying to manage every possible fiscal or monetary emergency no matter how trivial (while studiously ignoring their own role in creating said emergencies), has only managed to quite obviously have backed themselves – and all of us – into a corner.
Damned if they do, damned if they don’t.
Print more and create runaway inflation, don’t print more and watch all their bubbles crash and burn, and “the economy” along with them.
The Fed, in their infantile wisdom, built upon Alan Greenspan’s endless love for Wall Street by following the print and then print moar! Practices of Ben Bernanke.
“If I seem unduly clear to you, you must have misunderstood what I said.”
~Alan Greenspan — Speaking to a Senate Committee in 1987
This was followed by even moar! Printing by Janet Yellen and then the granddaddy of them all Jay Powell who oversaw this historically unprecedented fiasco:
M2
by rector 
