How financial markets and the economy performed last time the Federal Reserve took away the punch bowl by raising its policy rate and pursuing quantitative tightening. Things worked out fine that time. Will it be different this time?

Topics covered include:

Where did the phrase take away the punch bowl come from
How central bank actions can slow the economy and lower inflation.
The difference between having cash and having wealth
How quantitative easing and quantitative tightening work
What happened last time the Federal Reserve pursued quantitative tightening

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Show Notes

Address before the New York Group of the Investment Bankers Association of America on October 19, 1955, by William McChesney Martin, Jr.—FRASER

M2—Federal Reserve Economic Data

Assets: Total Assets: Total Assets: Wednesday Level—Federal Reserve Economic Data

Assets: Securities Held Outright: U.S. Treasury Securities: All: Wednesday Level—Federal Reserve Economic Data

Americans Reported Strong Personal Finances Late Last Year, Fed Finds by David Harrison—The Wall Street Journal

270: Repo Rates Soared—Here’s Why It Matters

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270: Repo Rates Soared—Here’s Why It Matters

295: Federal Reserve Insolvency and Monetizing the National Debt

312: What the Federal Reserve’s New Policies Mean For Your Finances

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Will Quantitative Tightening Lead To Even Greater Financial Losses? 29:58 Share

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Shownotes Transcript

Will Quantitative Tightening Lead To Even Greater Financial Losses?