The Fed Confesses Its Transitory Lie

At this stage, a wise person observes that these people are capable of anything [Gilder's Daily Prophecy] September 24, 2021 [UNSUBSCRIBE]( | [ARCHIVES]( Copy of Official Approval Enclosed (tech) [stamp]( July 2020, the U.S. Government approved a tech project that potentially disrupts a $2 trillion industry. One financial analyst has been gathering critical data – and he’s making his boldest prediction yet. Every shred of evidence that points to what lies ahead, including a copy of the official approval, [can be found here.]( To see how you can take advantage of this breakthrough tech, before Wall Street catches on, [Click Here.]( The Fed Confesses Its Transitory Lie [Jeffrey Tucker]Dear Daily Prophecy Reader, For most of this year, The Fed has constantly, publicly, officially, and repeatedly denied that the inflation we see all around us is anything more than temporary. They said it was merely the market readjusting to reopening, to supply-chain glitches, to housing shifts, and other factors that are merely transitory. It was never very credible. First, they cannot see into the future any better than you and I can. Despite all their data and models, they are just guessing. Second, they pumped like mad for 20 months to paper over the catastrophic shutdown policies that otherwise brought an immediate and intended economic depression to the country and the world. Third, they are under serious pressure to continue these policies for both political and financial reasons. Both markets and politicians are severely addicted to cheap money. I do not see how anyone can look at this M2 money supply chart going back 35 years and believe that everything is going to be just fine. [M2 Money Stock Chart] Yes, the relationship between money quantity and prices is simple on paper, but complex in the real world. There are lags, mitigating factors, issues of velocity and global demand, and so on. And yet there is that chart, with its undeniable and incredibly obvious explosion in money printing. And sure enough, we’ve got producer prices rising at levels not seen in decades. The Fed’s Target The Fed has long set its inflation marker at 2%, and has been frustrated for years that it has been unable to reach that target. Of course it all depends on how one calculates what constitutes inflation. Enough things going down in price balances out those things that are going up in price, and you generate an index number that pertains to nothing in particular. These days we are in a different position. Almost everything is going up in price. The Fed knows this. It first excused this on grounds that it had plenty of room to make up for past misses of its inflation target. On Wednesday of this week, The Fed released its new forecast. It admits now that inflation will be 2.3% percent. It’s utterly untrue. What matters here is that this is the first admission by The Fed that what is transitory is going to last a very long time. In addition, it accounts for why The Fed is for the first time in 20 finally talking about unloading some of the assets on its balance, to prepare for rate hikes in the future. These could still be two years away. The markets don’t expect them anytime soon, which is why most of what the Fed says these days the market disregards. When The Fed bumps its target to such an extent, at the same time starts making noises about adjusting its balance sheet, that suggests there is far more concern in Washington than The Fed is letting on. [No more banks. No more accountants. No more Wall Street?]( Former CIA and Pentagon Advisor: "Americans Should Do These 5 Things NOW" [Jim Rickards at CIA]( could be facing a catastrophe that will catch most people by surprise… And no, it’s not the coronavirus. Most Americans have no idea what’s about to hit them in the coming days. Which is why Americans should [take these 5 steps right now.]( [Click here now to see the shocking details.]( [FREE: The #1 Pre-IPO For The $100 Trillion Energy Disruption]( A New Digital Currency Please indulge me in a bit more speculation here. The same day that The Fed’s new forecast appeared, Chairman Jerome Powell announced that The Fed is working on a study on whether to back a new Central Bank Digital Currency (CBDC), along the lines of what China has rolled out in its first stages. The study is being produced by the Boston Fed with help from MIT data scientists. The idea of course is to utilize blockchain technology to improve payment systems and possibly even to produce its own version of cryptocurrency. It would work a bit like a stable coin — a digital token tied to the value of the dollar. It would not be of course a public ledger like Bitcoin. It would operate on a Fed-owned private ledger that would allow every transaction to be tracked and traced. There is some rich irony in this. The Fed has been criticizing Bitcoin and other cryptos for the whole of their existence. They claimed they were insecure, dangerous, problematic, and maybe not even real. They have generally treated them all like the enemy. Oh but now The Fed wants its own version of them? Yep. Call it a compliment to Satoshi Nakamoto! The timing certainly got me thinking. What if The Fed is even more worried about the future of the dollar than we think? What if The Fed believes that the status of the dollar as the world’s reserve currency could be in question over the coming years? In that case, what if this talk about the new CBDC is designed to prepare the way for a fundamental monetary change? I would not rule it out. Biden on Ransomware At the same time the Fed changed its forecast and started talking openly about its own digital currency, the Biden administration has unleashed a propaganda campaign to blame Bitcoin exchanges for facilitating the $400 million in ransomware paid over the last year. It has imposed new sanctions on the exchange called Suex located in the Czech Republic — the first time the US has done this to a foreign exchange. The Biden administration claims that the exchange is responsible in part for working with distributors of ransomware. We know how this works. It really isn’t about stopping crime. It is about starting control. They have tried every trick to reign in and regulate the crypto space, but they have generally failed. It is possible that the new path will be merely to claim that crypto exchanges are facilitating criminality and therefore need to be shut down. In other words, the government could be targeting its competition in anticipation of an eventual release of a Fedcoin. The great problem that any government has in releasing a crypto is assuring its valuation and pushing for adoption. Going after private cryptos and private exchanges would be one way to fix this issue. It’s a terrifying prospect, to be sure, and you can accuse me of being a bit paranoid after two years of monetary depredations and lies. But at this stage, a wise person observes that these people are capable of anything. Regards, [Jeffrey Tucker] Jeffrey Tucker P.S. We just got wind of a BIG Tesla story that no one else seems to be telling. Short version: the California car company is quietly working on a secret tech project that has nothing to do with electric vehicles, dancing A.I. robots, or car batteries. And yet, it’s part of a new ground floor opportunity (that Bloomberg says) will surge 12,100% in the coming years. What exactly is Tesla working on? [Go here now to get the details on this fast-moving disruption story](. (You’ll even get the #1 ticker symbol for playing this new 12,100% tech boom – for free, no sign-up required… Best part: it’s a company that’s only 1/600th the size of Tesla.) [Click here now](. Tesla’s Next Target We just caught wind of a BIG Tesla story that no one else seems to be telling… Short version: The California car company is working on a secret tech project that has nothing to do with… - electric vehicles… - dancing A.I. robots… or… - car batteries… And yet, it’s part of a new ground floor opportunity (that Bloomberg says) will surge 12,100% in the coming years. What exactly is Tesla working on? [Go here now to see the shocking details on this fast-moving disruption story.]( [Three founders Publishing]( To end your Gilder's Daily Prophecy e-mail subscription and associated external offers sent from Gilder's Daily Prophecy, feel free to [click here](. 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