The Fed is in Trouble

The justification to do absolutely anything at any cost to save the US economy was clear: Covid-19 was a medical emergency that shut down the economy and in order to sustain employment, borrowing and financial stability the Fed and policy makers had to act without hesitation -- and they did, with the US passing the US$2TN CARES act and the Fed cutting interest rates to zero and announcing unlimited purchases of treasuries as well as corporate debt, including "fallen angels" -- investment grade debt that had been downgraded to junk as a result of Covid-19. The Fed has pledged to keep their interest rate near zero until full employment and inflation recovers. Effectively, while the economy is bad and recovery seems far off the do-anything mandate stands. The problem for policy arises when the market begins to believe that a recovery is actually much faster than expected -- as happened on Friday with the monthly jobs report... (continued)

#	Side	Instrument	Volume	Price at inception	Current price	Change	P&L
1	Short	1305 ...	3000	¥1,733.00	¥1,674.00^D	-3.40%	¥177,000.00
2	Long	8411 ...	9300	¥142.30	¥134.40^D	-5.55%	¥73,470.00
3	Long	8316 ...	500	¥3,427.00	¥3,068.00^D	-10.48%	¥179,500.00
4	Long	8306 ...	4700	¥482.30	¥429.80^D	-10.89%	¥246,750.00
Total							¥322,720.00

The Fed is in Trouble

-3.07%

Closed

92d 5h 46m 53s

Strategy Percentage Return