The consequences of 'infinite money' - Chris Irons talks with Alpha Trader
This week's Alpha Trader podcast features hosts Aaron Task and Stephen Alpher talking about the Fed, gold, the dollar, and the big bull move in stocks with Quoth the Raven himself, Chris Irons of QTR Research. "The Fed is running the biggest long con in human history," Irons has previously said. By that he means the U.S. central bank for years has chosen the path of attempting to paper over any economic difficulties, rather than allowing markets to clear. The Fed's actions in response to the pandemic amount to papering over on massive amounts of steroids. Indeed, says Irons, the Fed's sole mandate these days has devolved into keeping the stock market rising in order to give the impression that all is well. It takes a lot of money printing to keep this ball rolling, says Irons, noting the Fed's Neel Kashkari recently said, "We have infinite money" to throw at the current crisis. This sort of heresy against the tenets of responsible central banking has to have consequences (timing to be determined). Among the possibilities: Hyperinflation, a sovereign debt crisis, a major bull market in gold (XAUUSD:CUR), the loss of reserve currency status for the dollar ([[UUP]], [[UDN]]). Don't get the impression Irons is all doom and gloom, though. There's plenty more, including why he thinks the economy will bounce back better than many think, why we're about to get a deluge of great news on Covid-19 treatments and vaccines, and why the S&P 500 should continue to rip higher.