Horde of jumbo bazookas

Credit Bubble Bulletin/Doug Noland/6-9-2019

“I have posited that the Fed’s balance sheet could swell to $10 TN during the next crisis. When the current Bubble bursts, the Fed and global central bankers will see no alternative than to flood the global financial system with central bank Credit. This is a terrible, reprehensible prospect. I warned ten years ago that QE was a slippery slope. After a decade, central bankers would surely today prefer to rebrand QE as a ‘conventional’ – and elemental – part of their arsenals. But it will not be until the next bursting Bubble phase before there is a modicum of a ‘body of evidence’ (from only one cycle) for assessing the effectiveness of history’s most radical monetary experiment. Today, global securities markets are eagerly anticipating the return of zero rates and more QE. Chairman Powell, Draghi and others are conveying the message that they are getting their arsenals ready.”

USAGOLD note:  Noland states well what will be preying on the minds of many as the direction of the Federal Reserve and other central banks becomes apparent. He could very well be right about that $10 trillion future balance sheet. . . .

Repost from 6-9-2019

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