Okay, everyone is staring at me like I'm confused, but think about it this way:
The economy is collapsing.
They want to inject it with cash, to push it up, again, at least in nominal terms, so that they can cover their debts with cheaper money.
But the inflation trend is ↘️. They keep trying to hype it up, by announcing "whatever it takes", but the market just hears "economy ded, we're panicking, everyone shut down production and fire your workers".
See that? Energy is getting cheaper. The price spike was due to the Ukriane war causing a temporary supply crunch. Consumption of energy collapsed down, to meet the higher prices, and now the price lowered to consumption. Higher prices solved higher prices.
And the war is still on. Once it ends, there will be a supply glut and the price will collapse further. That is why they want to redirect energy to highly consumptive projects like defense and infrastructure.
Crazy plan, hear me out…how about, no war?
Well, they actually depleted their stocks with this war, so they could spend trillions just restocking, for years.
It's not going to be sufficient, tho. The economy is too sluggish and exhausted. Nobody wants to take on credit, just to build things they can't sell, and they don't have the workers to build it all, anyway, and the customers are dying off.
But Rheinmetall shares are a good bet, at least.
US broad money supply is shrinking. This is deflation.
Even the M1 shows a mixed story, at best. Here, the 10 year.
My understanding is the economy has been shrinking, the Biden admin printed a shit-ton of money to prop it up, and now that it’s dried up, and DOGE is cutting the slush funds, the money supply is down, and we’re getting deflation. BUT they are letting this happen intentionally because they need to show the Fed inflation is not the risk it was and to force them to lower rates to re-finance the debt that’s coming due. Once that happens, massive print. Right now it’s the tide of the tsunami going out. It will come rushing in soon IMO.
