Jeffrey Miller: “I Don’t Know How Dumb Things Will Get Before Central Banks Finally Stop”

Jon Alternative Media, Blogosphere, Economy, Fiscal Policies, Government

Jeffrey Miller’s weekly letter did a masterful job describing how the Fed is simultaneously the most destructive organization on the planet yet also now the most useless. As we have done on numerous occasions, Miller points out the many negative consequences of the misinformed Fed policy that has driven a record $13 trillion of government debt into negative yield territory. Among those most impacted, of course, are pension funds and insurance companies. As we’ve discussed (here), pensions are locked in a never ending feedback loop where the combination of lower yields and long liability duration causes them to invest further out the yield curve which then drives yields even lower and the cycle repeats.
At some point the cycle will end but as Miller points out it’s hard to know just “how dumb things will get before they stop.”

This post was published at Zero Hedge on Aug 22, 2016.