Fed Rate Cuts Will Trigger Inflation & Market Kaos | Michael Kao

Michael Kao joins Wealthion’s Andrew Brill to warn that next week’s signaled Fed rate cut will likely have unforeseen consequences: a resurgence of inflation and market instability amidst what he calls a “Vodka Red Bull” bifurcated economy. In this insightful interview, the retired hedge fund manager and writer at Kaoboy Musings defies consensus by arguing that a short recession could benefit the economy in the long run and that the coming rate cut is risky while inflationary fiscal pressures and supply inelasticities in oil and housing remain a significant concern.


Don’t miss our live coverage of the Fed with Maggie Lake! Next Wednesday, September 18.

Chapters:
1:03 - The “Vodka Red Bull” Economy
9:17 - Michael’s Concerns Over a Premature Fed Pivot
15:43 - Was the Fed Late in Raising Rates? Analyzing Fed Policy Errors
26:14 - The Impact of Fed Policy on Markets and Real Estate
28:51 - How Much Will The Fed Cut Rates Next Week?
37:02 - Inflation Outlook, Oil, Global Monetary Dynamics and the U.S. Dollar
49:46 - Investment Strategies in a Confusing Macro Environment

Connect with us online:

#Fed #Inflation #InterestRates #EconomicOutlook #InvestmentStrategy #Recession #MichaelKao #Markets #Macro #Geopolitics #Investing #MarketAnalysis #Stocks #USD #Wealthion #Wealth #Finance #Economy
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[JimCollins-hu]

In my opinion<, according to what I heard in my college macroeconomics class, the reason why lower inflation would hurt the middle class is because, in order for the FED to lower inflation, they have to raise rates, lowering debt, which lowers demand. Any lower prices would be from a decline in demand. If they just get rid of all the money that they printed, reversing our inflation and bringing prices to how they were, our economy would likely collapse overnight. That's why historically, the FED dropping inflation by a percent has had a 2-3 percent decrease in GDP. But the recent surge in demand from inflation is only temporary, as people will eventually adjust and cut back on spending, which we are starting to see. The FED has backed itself into a corner.

[JenniferCochran-we]

I didn't become financially independent until I was in my late 40's, and I'm still in my 40's. In addition to having purchased my second home and earning money on a monthly basis through passive income, I've also achieved three out of five goals. I just hope this inspires someone to realize that it doesn't matter if you don't have any of these things yet, you can start today no matter your age. Change your future by investing! I made a rather big decision by investing in the financial market.

[Notrocketscience]

This guy rarely gets anything right. You're better off flipping a quarter.

[kevinfeldman]

When did people start using diligencing as a word?

[joshuad]

I don't think lowering interest rates will being the jobs back. So little to no inflation