The hottest Central Banking Substack posts right now

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International financial anarchy

Noahpinion • 27294 implied HN points • 01 Feb 26
💰 Finance Central Banking
  1. Gold has re-emerged as the main safe-haven asset, with central banks and investors buying it, while Bitcoin has not behaved like “digital gold” during recent turmoil.
  2. The dollar’s international roles — payments, reserves, and collateral — are distinct, and because currencies can be swapped quickly, using the dollar for payments doesn’t necessarily force large reserve holdings; building non-dollar payment systems makes de-dollarization easier.
  3. China’s push to expand yuan payments and accumulate gold could enable a challenge to the dollar, but China hasn’t shown a clear desire to replace it, and a change in reserve currency wouldn’t automatically revive U.S. manufacturing — policy choices matter more.

The Fed's Independence is at Stake and it May Be Its Own Fault!

TK News by Matt Taibbi • 2849 implied HN points • 21 Jan 26
💰 Finance Central Banking
  1. The Fed’s independence is under direct political threat, as prosecutions and public attacks on its chair show how easily monetary policy can be politicized.
  2. Since 2008 the Fed gained huge powers (QE and near-zero rates) and its leaders became public celebrities, which makes their decisions more influential and more attractive targets for presidents who want easier policy.
  3. By failing to stop the pre-2008 bubble and then rescuing the system with extraordinary tools, the Fed created moral hazard and invited interference; protecting independence means avoiding normalizing emergency policies and dialing back the public spotlight.

Jerome Powell's Scorched Earth Moment?

QTR’s Fringe Finance • 27 implied HN points • 18 Mar 26
💰 Finance Central Banking
  1. Jerome Powell may be at a defining moment where his actions could have major consequences for policy and markets.
  2. Today’s Fed press conference and policy decision are especially important and worth close attention because they could shift market expectations.
  3. Detailed analysis of the situation is available only to paid subscribers, so the deeper takeaways are behind a paywall.

The Fed's New Target: Part II

Concoda • 302 implied HN points • 15 Feb 26
💰 Finance Central Banking
  1. The overnight fed funds rate is becoming unreliable because trading volumes have collapsed and rival interbank markets are emerging, putting the current mechanism near a breaking point.
  2. Since 2008, huge reserve growth has propped up the effective fed funds rate and hidden the decline in unsecured interbank activity, but that stability is fragile and no longer shows the true cost of dollar funding.
  3. The Fed will need a new target rate soon, and it is likely to consider options like administered rates (IORB or o/n RRP), an existing benchmark, a rates basket, or creating a new benchmark.

Plumbing Notes: A Global Compression

Concoda • 540 implied HN points • 01 Feb 26
💰 Finance Central Banking
  1. The Fed’s bill buying has compressed the SOFR–fed funds basis and pushed overnight dollar funding rates into a narrow ‘sweet spot’ a few basis points below interest on reserves.
  2. Large banks are swapping reserves into Treasuries and keeping extra reserve cushions because of unrealized losses and outflow risk, so big dollar clearers are less willing to step in as backstops.
  3. Further Fed cuts will likely reduce excess reserves but make banks more willing to lend at tighter spreads, helping contain overnight rates and supporting a weakening macro outlook.
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Top Links 1000 Fed dissent. Restricting junk food. Hidden foster care & the secret SLS.

Chartbook • 586 implied HN points • 01 Feb 26
💰 Finance Central Banking
  1. The Federal Reserve is growing more divided about the right path for interest rates, which could raise uncertainty for markets and borrowers.
  2. Policymakers and public-health groups are pushing to restrict junk food availability and marketing to combat obesity and related illnesses.
  3. Serious issues in foster care are staying hidden from public view, and a secretive SLS program underscores gaps in oversight and transparency.

Fed Should Hold Rates Steady In March

QTR’s Fringe Finance • 19 implied HN points • 17 Mar 26
💰 Finance Central Banking
  1. The Fed should hold its policy rate steady in March rather than cut, because current economic data don’t justify easing despite headline uncertainty.
  2. Monetary policy rules like the Taylor rule and nominal GDP rules point to a policy rate near 4 percent, which is above the current 3.5–3.75 percent range and suggests restraint or even a modest increase.
  3. Further rate cuts would need clear evidence — for example inflation falling toward 2 percent, unemployment rising by about a full percentage point, or a sizable drop in nominal spending — so the Fed should wait for those signals before easing.

The Fed Should Stay in Its Lane

Common Sense with Bari Weiss • 449 implied HN points • 03 Feb 26
💰 Finance Central Banking
  1. The Fed has drifted into topics like climate change and social policy, publishing research and public messages beyond its traditional focus on inflation and banking.
  2. That mission creep triggered public backlash and raised concerns among staff and observers that the central bank is becoming politicized.
  3. A new chair should refocus the Fed on core monetary policy and avoid advocacy on issues like climate or childcare, but pulling it back to that lane will be a difficult task.

Infographics: The Modern Repo Market

Concoda • 329 implied HN points • 22 Jan 26
💰 Finance Central Banking
  1. A large, detailed infographic maps how cash and collateral move through the modern repo market around 2026.
  2. The chart is best downloaded and viewed on a high-resolution device; start at the green "start here" box in the top-right, follow flows right-to-left, and consult the legend to learn the terminology.
  3. A follow-up write-up will unpack the chart and explain the mechanics and jargon in more detail.

Four Rules for the New Fed Chair

Common Sense with Bari Weiss • 255 implied HN points • 31 Jan 26
💰 Finance Central Banking
  1. Kevin Warsh is well qualified for Fed chair, with the intellect and experience to engage with complex policy and market issues.
  2. His confirmation should depend on clear commitments to protect the Fed’s independence and on the President taking visible steps to resolve legal or political uncertainty around the central bank’s leadership.
  3. The Fed’s success rests on credibility and autonomy, not just technical mastery, because markets only function well when they trust the central bank.

Plumbing Notes: The Great Compression

Concoda • 551 implied HN points • 15 Dec 25
💰 Finance Central Banking
  1. The Fed has stepped in to tame money-market volatility by buying short-term U.S. Treasuries and injecting reserves sooner than expected, running roughly $40 billion a month in these operations.
  2. Those actions will compress overnight rates and short-term spreads as reserves move back toward near-abundant levels, but because the purchases target ultra-short bills rather than longer-term bonds, they won’t be a broad easing of financial conditions or sharply lower long-term rates.
  3. The goal is to build a reserve cushion to protect against volatile Treasury General Account flows and tax-day outflows, reducing the chance of disruptive interbank strains.

The Fed's New Target: Part I

Concoda • 281 implied HN points • 10 Jan 26
💰 Finance Central Banking
  1. The Fed is moving away from targeting an unsecured overnight fed‑funds rate and toward a secured repo benchmark as its main policy rate to reduce volatility and strengthen control over money markets.
  2. The Fed has started large reserve injections and new permanent open‑market operations that have compressed overnight money‑market rates and prevented year‑end plumbing stress.
  3. As a result, banks’ balance sheets are set to expand, the repo market will become central to rate setting, and the unsecured interbank market’s role is likely to shrink.

Infographics: How Liquidity Requirements Create Demand For Reserves/U.S. Treasuries

Concoda • 340 implied HN points • 24 Dec 25
💰 Finance Central Banking
  1. Liquidity rules push big banks to hold safe, liquid assets like reserve balances and U.S. Treasuries, which creates steady demand for those assets.
  2. Large banks face intraday liquidity needs that force them to keep enough reserves available to settle payments and manage cash flows during the day.
  3. Visual diagrams help show how those intraday requirements link to central bank policy and Treasury demand, clarifying why reserves matter for markets.

Infographics: The Fed's Repo Rate "Sweet Spot"

Concoda • 286 implied HN points • 28 Dec 25
💰 Finance Central Banking
  1. The Fed wants repo rate benchmarks to sit in a narrow "sweet spot" just below the Interest on Reserve Balances (IORB) rate.
  2. It will actively force those repo rates to print inside that zone, even when market pressures push them elsewhere.
  3. Opposing forces can move repo benchmarks off-target, but the Fed intends to counteract them to keep rates anchored just below IORB.

The Fed Is Adding $20B A Month To The Balance Sheet

QTR’s Fringe Finance • 22 implied HN points • 03 Mar 26
💰 Finance Central Banking
  1. The Fed quietly restarted QE and is adding roughly $20 billion a month to its balance sheet, which is already about $6.6 trillion and could balloon much higher in the next crisis.
  2. Most Fed purchases have been in short-term debt, which has pushed short rates down and steepened the yield curve. The Fed has been losing money and isn’t remitting profits to the Treasury, leaving a large deferred loss.
  3. Foreign buyers have helped absorb new Treasury issuance but their buying has flattened recently, so if the Fed won’t buy long-term bonds and foreign demand stalls, Treasury borrowing costs could spike and further strain the budget.

Lula Hoops

Doomberg • 5190 implied HN points • 29 Oct 24
💰 Finance Central Banking
  1. Gold prices have been rising significantly and outperforming the S&P 500 lately, reaching all-time highs in many currencies.
  2. There's speculation that central banks are accumulating gold as they explore options for a new currency to compete with the US dollar, particularly involving a potential BRICS currency backed by gold.
  3. At the recent BRICS summit, there were concerns that Brazil's president might not fully support efforts to move away from the US dollar, which could impact the success of this new currency initiative.

Will AI Cause Massive Deflation?

cryptoeconomy • 1493 implied HN points • 02 Feb 24
💰 Finance Central Banking
  1. There will not be durable deflation in the future unless major changes happen to the dollar or the Federal Reserve.
  2. Technology like AI can lead to deflation by lowering prices, but central banks like the Federal Reserve counteract this by absorbing the deflation.
  3. A special type of bad deflation occurs when dollars are taken out of circulation, often due to events like financial panics, leading to economic challenges.

San Francisco Fed President Mary Daly and Richmond Fed President Tom Barkin on What's Actually Happening in the Economy

Kyla’s Newsletter • 121 implied HN points • 09 Jan 26
💰 Finance Central Banking
  1. The Fed is learning from the 1970s vs 1990s: inflation expectations and productivity trends matter. AI could boost productivity but that’s uncertain, so policy needs to be cautious and nimble.
  2. Persistent uncertainty and a gap between sentiment and official data are major issues. Negative news cycles make people feel worse even when jobs, wages, and spending remain fairly strong.
  3. The economy has been surprisingly resilient but growth is narrow, driven by AI investment and healthcare jobs, which creates concentration risks linked to the stock market and hiring. Ground-level signals like cranes and parking lots are useful to check what businesses are actually doing.

Why Boom-Bust Cycles Validate Austrian Economics

QTR’s Fringe Finance • 25 implied HN points • 21 Feb 26
💰 Finance Central Banking
  1. Artificially low interest rates from central bank credit expansion lure entrepreneurs into projects that look profitable but aren’t supported by real consumer preferences, creating a boom that later collapses when policy tightens.
  2. Even if businesses correctly anticipate rate moves, changes in the money supply divert resources into non‑wealth‑generating activities, and variable, unpredictable time lags make it impossible to reliably time or avoid those distortions.
  3. Because firms must chase observable demand or risk failure, the harm from expansionary monetary policy becomes self‑reinforcing and cannot simply be undone by better expectations, so boom‑bust cycles persist.

Miao Yanliang on renminbi internationalisation: China’s test is domestic after peak dollar

Pekingnology • 79 implied HN points • 26 Jan 26
💰 Finance Central Banking
  1. Dominant currencies endure because of strong network effects, but that very stability can create problems that weaken the incumbent and open a brief window for challengers.
  2. Economic size alone won’t make a currency central. A country also needs deep, liquid financial markets and trusted institutions, so timely, decisive reforms are essential to seize any opening.
  3. For the RMB to move toward the centre, China must deepen onshore markets, allow a more flexible exchange rate, open the capital account steadily, and build trusted payment and digital infrastructures. If these reforms are implemented well, the RMB can become a credible, stabilising force in a more multi‑centre monetary system.

What Causes Stagflation?

QTR’s Fringe Finance • 19 implied HN points • 24 Feb 26
💰 Finance Central Banking
  1. Increasing the money supply creates an “exchange of nothing for something” that shifts resources away from producers, which raises prices while weakening real economic growth — this combination is stagflation.
  2. Unexpected boosts in money growth can temporarily cut unemployment and raise output, but once people expect higher inflation they change their behavior and the growth gains vanish, leaving only higher inflation.
  3. The severity and visibility of stagflation depends on private savings: falling savings make weaker growth and higher unemployment clear, while rising savings can mask weak growth even as prices climb.

Valuations Don’t Matter When Money Is Fake

QTR’s Fringe Finance • 61 implied HN points • 19 Jan 26
💰 Finance Central Banking
  1. Central bank money printing and nonstop liquidity have decoupled prices from fundamentals, so extreme valuation multiples can persist because liquidity, not earnings, drives markets.
  2. That liquidity is uneven, concentrating in a handful of mega-cap firms that prop up indexes while most stocks and the real economy lag behind.
  3. Given these distortions, protecting wealth matters more than timing the market — diversify into sound money, real assets, and non-dollar exposure instead of relying on historical valuation limits.

Liberty Eroding, Gold Rising: 30 Years of Warning

QTR’s Fringe Finance • 27 implied HN points • 11 Feb 26
💰 Finance Central Banking
  1. Gold’s rising dollar price reflects the dollar’s debasement and tracks an inverse relationship with economic freedom; as political and fiscal liberty fall, gold tends to rise.
  2. Since abandoning the gold-exchange standard, expanding welfare-warfare spending and central-bank debt monetization have eroded monetary integrity and long-term purchasing power.
  3. For investors, gold has often outperformed equities this century and acts as a hedge against unstable fiat money, even though a formal return to a gold standard looks politically unlikely.

Our Liquidity Addiction Continues

QTR’s Fringe Finance • 21 implied HN points • 09 Feb 26
💰 Finance Central Banking
  1. The Fed has begun a modest, ongoing balance-sheet expansion—buying short-dated Treasuries to keep banks flush with reserves and control short-term rates—which is a "gradual print" that should be mildly supportive for asset prices and mildly dollar-negative.
  2. Severe shocks like a recession, a large-scale financial or kinetic conflict, or sudden foreign sell-offs could force much larger, faster Fed purchases measured in the trillions, while a change in Fed leadership might try to shrink the balance sheet but would only have limited, mostly technical effects.
  3. Japan’s rising bond yields are a real risk but not an immediate systemic collapse: the BOJ owns a large share of the debt and Japan has big FX reserves and a current-account surplus, so policymakers have tools (yield-curve control, reserve sales) to manage it; investors should favor high-quality, scarce assets and rebalance away from overheated areas.

Warsh Or Not, The Fed’s Next Chair Will Inherit Too Much Power

QTR’s Fringe Finance • 23 implied HN points • 04 Feb 26
💰 Finance Central Banking
  1. The Fed has turned crisis tools into permanent powers, like a standing repo facility and huge emergency lending programs, without clear sunset clauses or limits.
  2. Those powers let the Fed act beyond its original mandate — extending credit to borrowers Congress never explicitly authorized and exercising wide regulatory discretion, as seen in decisions around crypto banks.
  3. Weak oversight and accountability (no independent inspector general and only semiannual Congressional checks) invite political pressure and create moral hazard, making firms more dependent on the Fed and eroding its independence and credibility.

Why Can’t I Have My Own Money Printer?

QTR’s Fringe Finance • 40 implied HN points • 13 Jan 26
💰 Finance Central Banking
  1. If an individual could print money, they'd likely stop producing and live off others because printing is easier than earning, which creates money without creating goods or services.
  2. If everyone printed money, production would collapse and the economy would be flooded with worthless bills, since there would be lots of money but few goods to buy.
  3. The government can also create money and temporarily boost demand, but that too can't substitute for real production, raising a hard question about why private money printing is illegal while institutional money creation is allowed.

The Dollar's Death In 2026 Is Now A Mainstream Talking Point

QTR’s Fringe Finance • 49 implied HN points • 31 Dec 25
💰 Finance Central Banking
  1. The US dollar’s global dominance is eroding as countries and blocs build alternative settlement systems and settle more trade in local currencies, making the dollar increasingly optional.
  2. US fiscal and monetary policy choices plus the weaponization of dollar-based finance are pushing other nations to de-dollarize, and the US Treasury market shows structural fragility that often needs central bank support in stress.
  3. Market signals—rising gold and silver, growth of RMB-linked and commodity-backed stablecoins, and wider mainstream coverage—suggest a steady loss of confidence in the dollar rather than a sudden collapse, with major shifts likely ahead.

Central Banking in the Age of Chaos-Monkey Tariff Threats: It Would Not Be That Hard for Fed Governor Chris Waller to Do His Job Professionally

Brad DeLong's Grasping Reality • 253 implied HN points • 18 Jul 25
💰 Finance Central Banking
  1. Fed Governor Christopher Waller should push for an end to tariff chaos, which creates inflation risks. It's important for him to act professionally and prioritize stability.
  2. Current interest rates may need to go down since they could be too high for economic growth. The Fed should be cautious and not cut rates hastily amid ongoing tariff issues.
  3. The Federal Reserve's credibility relies on resisting political pressure. They should remind the Executive that stable economic policies need changes in how the government operates.

Money Market Update

Concoda • 237 implied HN points • 10 Jul 25
💰 Finance Central Banking
  1. The recent debt limit uncertainty is making it harder for banks to get the money they need, which will likely push interest rates up. We can expect funding pressures in money markets to grow.
  2. The Federal Reserve plans to cut down on reserves, which means banks might have to compete more for cash. This could lead to the Fed needing to step in with measures to pump money into the system.
  3. Demand for U.S. Treasury bonds is holding steady despite fiscal worries. However, if concerns about the economy rise again, it could lead to changes in investment behavior.

Monetary Policy Is Monetary Piracy

QTR’s Fringe Finance • 28 implied HN points • 06 Jan 26
💰 Finance Central Banking
  1. State-run monetary policy acts like theft because creating money for private banks concentrates wealth with insiders and helps cause recurring financial crises.
  2. Money and banking should be separated from the state; legal tender laws and special banking privileges (like protections for fractional-reserve lending) enable monetary piracy and should be repealed so people can choose competing currencies.
  3. A free market for money, grounded in private property and competition, would produce sounder money and make financial actors accountable to customers rather than the state.

How Much Change When BOJ Eventually Tweaks? Part 1

Japan Economy Watch • 139 implied HN points • 11 Mar 24
💰 Finance Central Banking
  1. Interest rate changes depend on both BOJ policy and financial market conditions, and a policy tweak is likely to result in a gradual, minor impact on rates.
  2. BOJ's intention appears to be maintaining accommodative financial conditions by making small adjustments to policies like the overnight rate and yield curve control.
  3. BOJ's decision-making process is influenced by the balance of risks in moving too early or too late, with a focus on clear evidence of sustained wage growth before significant policy changes.

The Real Mission of the Fed

In My Tribe • 607 implied HN points • 11 Nov 24
💰 Finance Central Banking
  1. The main job of the Federal Reserve is to help the government borrow money easily and cheaply. This allows the government to spend on various programs, including wars and welfare.
  2. Despite originating to stabilize the banking system, the Fed has faced criticism for not preventing financial crises. Even after its creation, the U.S. has experienced repeated financial problems.
  3. Quantitative Easing, a method the Fed uses to handle money and loans, may need to end. This would help limit government debt and potentially benefit everyday Americans in the long run.

Money Market Update

Concoda • 464 implied HN points • 05 Jan 25
💰 Finance Central Banking
  1. The Federal Reserve took steps to manage money market pressures around year-end, which helped stabilize the situation. They provided morning repo operations to encourage lower trading rates.
  2. Despite these efforts, many traders still chose not to use the Fed’s cheapest repo options, which showed a lingering fear about using those facilities. This meant that repurchase agreements still traded at higher rates.
  3. Looking ahead, the debt ceiling is expected to cause uncertainty in the money markets. As people prepare for this, interbank liquidity may increase, but it won't necessarily make funding any easier.

Cutting Interest Rates Isn’t a Cure‑All for the Economy

QTR’s Fringe Finance • 18 implied HN points • 12 Jan 26
💰 Finance Central Banking
  1. Cutting interest rates only creates a temporary boom with fake job gains and malinvestment that leads to a deeper bust later.
  2. A real recovery needs market‑driven interest rates, sound money, and fiscal restraint so savings and investment can realign properly.
  3. Labor-market problems are worsened by wage rigidities and regulations, so letting wages adjust and removing hiring barriers helps jobs recover.

Discounting the Future: Financial Markets, Memory, & the Mirage of ‘Normal’

Brad DeLong's Grasping Reality • 192 implied HN points • 19 Jun 25
💰 Finance Central Banking
  1. Financial markets are uncertain right now, with discount rates showing anxiety about growth and policy directions. It's a confusing time that could lead to either growth or recession.
  2. The Federal Reserve is divided on its future rates, indicating a cautious approach as they wait for more data. Mixed opinions exist about how to respond to inflation and economic conditions.
  3. The concept of a 'normal' economy has changed significantly since the 1990s. Today, interest rates and inflation are at levels that do not align with past expectations, leading to a new financial landscape.

The Return Of Quantitative Easing

QTR’s Fringe Finance • 23 implied HN points • 22 Dec 25
💰 Finance Central Banking
  1. The Fed has stopped shrinking its balance sheet and is restarting quantitative easing to keep reserves ample and preserve policy flexibility.
  2. Huge Treasury deficits and political pressure have pushed up demand for reserves, so the Fed is buying assets to ease policy without formally cutting the federal funds rate.
  3. Restarting QE will help lower government borrowing costs and reduce the Fed’s interest bill, but it risks higher inflation and may look like capitulation to political pressure.

Longer, Higher For Longer

QTR’s Fringe Finance • 23 implied HN points • 18 Dec 25
💰 Finance Central Banking
  1. Interest rates are the core price that coordinates savings and investment, and heavy central-bank intervention has turned them into an administered price that can obscure real market signals.
  2. After a forty-year decline, long-term rates may be shifting higher because of large government debt, weaker anti-inflation norms, and adverse demographics — implying bonds could be "longer, higher for longer."
  3. If long rates stay higher, long-term bonds and real stock returns will likely suffer while commodities (especially gold) may outperform; keeping a very low fixed-rate mortgage and favoring companies with easy access to commodities could make sense.