For some time now it has been the belief of many Fed-watchers that the Federal Reserve would continue to hike interest rates until it “breaks something.” Lyn Alden of Lyn Alden Investment Strategy returns to Forward Guidance to argue that the stunning collapse of two large U.S. banks represents such breakage. Alden tells Jack Farley that this damage will soon give way to a period of low real interest rates, where inflation runs above Treasury yields. Filmed the afternoon of March 15, 2023.
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Timestamps:
00:00 Intro
00:43 The Cause Of The Turmoil In Banking System
07:08 Are Rising Interest Rates Actually Good For Banks?
08:50 Alden's Outlook on Banks As A Business
12:47 Has Something "Broken"?
15:38 Interest Rate Risk In The U.S. Banking System
22:43 Public Ad
23:48 Will Banks Become More Cautious About Making Loans?
31:11 Is The Fed's Campaign To Raise Interest Rates Over?
38:37 Debt, Demographics, and MMT (Modern Monetary Theory)
53:28 Recession Risk
58:48 Stock Market During Financial Repression
01:01:29 Fractional Reserve Banking and "The Narrow Bank"
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets.
