Sometimes you wish that politicians, central bankers, and other authority figures would just come out and say what’s on their mind.
Take Fed Governor Lael Brainard, for instance. At a National Association for Business economics event she said:
“The pandemic remains the key driver of the economy’s course. A thick fog of uncertainty still surrounds us, and downside risks predominate.”
She went on to say that the Fed should use forward guidance and large-scale asset purchases for a sustained period of time to help the recovery.
She could’ve been clearer, and more concise. All she had to say is, the economy sucks, we don’t know when it will get better, so we’re going to print a lot of money to buy bonds for as long as it takes.
It’s not as if the rest of us don’t know what’s going on. The Fed has driven short-term rates to zero and bought $3 trillion in bonds over the past several months, while 46 out of 50 states reported higher COVID-19 cases last week and the number of deaths across the country from the disease rose for the first time since mid-April.
What looked like a possible recovery in late May and early June is now a distant memory.
But hey, at least the stock market is zooming to the moon… for now.