The Fed Can’t Stop Now — Massive Money Printing Is Next

The Federal Reserve is projected to cut interest rates, end quantitative tightening, and re-engage in significant money printing, leading to continued inflation and a widening wealth gap.

• Federal Reserve is set to cut interest rates twice by year-end.

• Quantitative tightening is ending, with money printing expected by 2026.

• Continued inflation and dollar devaluation will widen the wealth gap.

The Federal Reserve is poised to cut interest rates on October 29th and again in December, signaling a return to easy money policies. Following these cuts, quantitative tightening is expected to cease, paving the way for substantial quantitative easing or 'money printing' by 2026. This trajectory is predicted to fuel asset price inflation, further devalue the dollar, and exacerbate the wealth gap.

Projected Interest Rate Cuts

• 00:01:24 Jerome Powell's statement that the outlook for employment and inflation has not changed since September implies the Federal Reserve will proceed with its earlier projections for interest rate cuts. This means a 0.25% rate cut is expected on October 29th, followed by another 0.25% cut in December, bringing the federal funds interest rate down to 3.75% from its current 4.25%. The CME FedWatch tool indicates a high probability, 97.8% and 92.8% respectively, for these cuts, suggesting the market strongly anticipates 'easy money' and a tailwind for the stock market and precious metals.

End of Quantitative Tightening

• 00:03:09 Quantitative easing, or 'money printing,' and quantitative tightening, which removes money from the system, are tools used by the Federal Reserve. After previous periods of massive money printing during the Great Financial Crisis ($4 trillion) and the pandemic ($5 trillion), the Fed began quantitative tightening (QT) in June 2022, reducing its balance sheet by $2.2 trillion. Jerome Powell indicated that QT could end in the coming months, signaling an imminent shift in monetary policy.

Return to Money Printing

• 00:04:34 The Federal Reserve's 'playbook' is anticipated to involve interest rate cuts, followed by a halt in quantitative tightening, and then a return to 'money printing' or quantitative easing by 2026. This cycle is expected to require even greater amounts of money printing in future crises, leading to increased monetary inflation. This systematic approach is seen as an inevitable response to economic pressures, despite its inflationary consequences.

Gold as an Inflation Hedge

• 00:04:54 Gold is highlighted as a significant inflation hedge, having appreciated by 60% year-to-date, due to the ongoing and projected money printing. As the Federal Reserve devalues the dollar by printing more currency, it takes more devalued dollars to purchase an ounce of gold, reinforcing its role as a safe haven asset. The Federal Reserve's perceived dislike for gold stems from its challenge to their control and power derived from the ability to print money, leading other countries and increasingly Americans to 'de-dollarize' and seek alternatives due to inflation.