The Illusion of a Hawkish Fed

There Is No Room to Tighten

Seeing a narrative going around that gold is selling off because everyone is getting liquidated.

Please.

If that were the case, people would be selling stocks first.

Gold is leading the downside.

To me, this still looks like a market pricing in an extremely tight monetary policy to deal with a reacceleration of inflation.

I really struggle with that view.

This is not the 1970s. Back then, the Fed had room to act.

Debt levels were low, and rates could be pushed into double digits without immediately destabilizing the system.

Today couldn’t look more different.