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Central Markets by Robert Lloyd, CFA

The information contained herein has been obtained from sources believed to be reliable, but the accuracy of the  information cannot be guaranteed. All opinions and outlooks are subject to change.

  • Writer's pictureRobert Lloyd, CFA

The Fed is pulling our collective leg

Despite all the talk about fighting inflation, the Federal Reserve policy stance is anything but restrictive. By comparing the Federal Funds policy rate (FF), the US 10-year Treasury yield (10yr), and inflation, it is our view that current Fed policies are highly supportive of the current inflationary regime.

While we are likely to see inflation fall as we travel through recession, let's not kid ourselves where the Fed stands on this. By any objective policy measure, they are HIGHLY supportive of the inflationary environment we are in right now. In 1971, the Fed had to raise rates to 9% to suppress 6% inflation. In today's 9% inflationary environment the Fed is lauded as a hero for raising rates to a whopping 2.25%. Do you see what I see?

Chief Investment Officer

Lloyds Intrepid Wealth Management

Lloyds Intrepid LLC is doing business as Lloyds Intrepid Wealth Management. Lloyds Intrepid LLC offers investment advisory services in the State of Texas where registered and in other jurisdictions where exempted. Registration does not imply a certain level of skill or training. Lloyds Intrepid LLC and its advisers do not provide legal, tax or accounting advice. Lloyds Intrepid LLC formulates retirement plans, investment strategies, portfolio construction and investment due diligence for clients with signed investment advisory agreements with us. The information contained herein has been obtained from sources believed to be reliable, but the accuracy of the information cannot be guaranteed. All opinions and outlooks are subject to change.

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