Welcome to Whose Economy Is It, Anyway?, where the rules are made up and the dollars don’t matter. Or at least that seems to be the view of the Yellen regime.
The Fed is launching a new billionaire bailout designed to keep banks afloat, and the FDIC is promising to back potentially trillions in deposits. The taxpayer will ultimately be on the hook.
Keynesians and fellow travelers hold the Phillips curve to be sacrosanct. But because the Phillips curve cannot establish causality, it is useless as economic theory.
The incredible growth and success of SVB could not have happened without negative rates, ultra-loose monetary policy, and the tech bubble that burst in 2022.
The current job market strength partly reflects the ongoing monetary overhang from years of breakneck growth in money-supply inflation. The $6 trillion in money that was newly created since 2020 is still very much a factor.
