$8 trillion hides negative 19% interest
Source: FRED, St. Louis Fed.
Sometime around the 19th of next month, the Fed’s balance sheet will reach $8.04 trillion (as another $120 billion is added).
By then, the balance sheet will have grown at a compound annual growth rate of ~19% since the Bernanke Bazooka at the time of the GFC.
That means the US dollar has been debased by 19% per annum.
Any business that has not generated a return on capital employed of at least 19% per annum has gone backwards.
Any investment portfolio that has not generated at least 19% per annum has gone backwards.
Looked at another way, interest rates are -19%.
Do zero yielding gold, diamonds, crypto assets, collectibles and commodities look better now?
Mike.
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