The hottest Monetary Policy Substack posts right now

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Lessons for Debt Control from Clinton's Success in the 1990s

Brad DeLong's Grasping Reality • 222 implied HN points • 01 Jan 26
💰 Finance Monetary Policy
  1. When fiscal consolidation is credible and the central bank supports demand while technology cuts the price of capital, private investment can be crowded in and overall growth can accelerate.
  2. The 1994 bond-market selloff reflected unexpectedly strong tech-led growth and mortgage-backed‑security duration effects, not a market fear that deficit cuts would wreck the recovery.
  3. The 1993 deficit‑reduction package paired tax increases with spending caps and expanded the EITC, which helped working families and long‑run growth, while much of the political opposition was partisan theater rather than a unanimous professional economic judgment.

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

QTR’s Fringe Finance • 22 implied HN points • 03 Mar 26
💰 Finance Monetary Policy
  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.

Late-Cycle Investment Theory: Winter 2025–2026 in 10 Snapshots

European Straits • 21 implied HN points • 22 Feb 26
💰 Finance Monetary Policy
  1. The US is showing early stagflation: growth is slowing, inflation remains sticky, and consumer spending is soft even as energy and tech costs rise with weak wage growth.
  2. China now operates at a civilisational scale that breaks ordinary economic frameworks, and it is building a massive electrified industrial base that could make it the leader of a new ‘electrostate’ era.
  3. The tech and financial cycles are shifting—AI-driven hype looks like the wrong kind of bubble, while electrification (batteries, motors, power electronics) and tokenisation of finance are becoming the real structural forces reshaping industry and monetary order.

No. Fed stimulus doesn't hurt first-time homebuyers

Erdmann Housing Tracker • 126 implied HN points • 27 Jan 26
💰 Finance Monetary Policy
  1. Changes in mortgage rates mainly shift short-term buying and prices, but they don't plausibly explain large, long-term declines in the share of first-time homebuyers.
  2. Factors like credit access rules, down-payment/LTV constraints, repeat-buyer activity, foreclosure and seller swings, and housing supply shortages are more important and lasting drivers of homeownership patterns.
  3. Empirical models that accumulate transitory rate shocks or use unrealistic assumptions (no construction, exogenous rents) can give misleading causal conclusions, so housing research needs better counterfactuals and out-of-sample testing.

Plumbing Notes: The Repo Fortification

Concoda • 340 implied HN points • 03 Dec 25
💰 Finance Monetary Policy
  1. The Fed's repo facility is struggling, with many banks hesitant to use it due to a fear of being seen as in trouble. This means that even though rates might be lower, banks are avoiding the facility, impacting liquidity.
  2. Recent efforts like morning Fed repos have been implemented to help banks access cash more easily and reduce exposure to interest rate risks. However, these changes are seen as temporary fixes rather than long-term solutions.
  3. There are still underlying issues, such as the stigma around using the Fed's facilities and costs associated with balance sheets, that need to be addressed for the repo system to work effectively. The Fed may need to take bold actions to restore confidence and improve access to central bank funding.
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Do Homebuilders have an inventory problem?

Erdmann Housing Tracker • 84 implied HN points • 05 Feb 26
💰 Finance Monetary Policy
  1. Months-of-supply is a misleading metric because it mainly rises when sales fall, so it often just mirrors the sales trend rather than showing true excess inventory.
  2. Builders generally start homes in step with sales, so absolute unsold units haven’t exploded the way the months-of-supply chart suggests, meaning current measures don’t automatically imply dangerous overbuilding.
  3. Policymakers have misread this signal before and worsened downturns, and today the same misinterpretation may be pushing homebuilder stock prices down and could present a buying opportunity.

The Last Living Value Investor's Portfolio

QTR’s Fringe Finance • 21 implied HN points • 02 Mar 26
💰 Finance Monetary Policy
  1. The market looks like a big bubble with stretched valuations that could snap back hard if conditions change. A fair-value PE near 17.6x implies roughly a 30% drop from current levels if earnings don’t rise.
  2. The portfolio stance is defensive and skeptical: largely on- and off-net short to protect against a bubble popping, though shorts can be temporarily covered for specific catalysts like geopolitical events.
  3. There are five deep-value long positions (two added recently), and three of those longs yield over 6% in dividends, reflecting a preference for high-yield, fundamentally cheap opportunities inside an overheated market.

Still Not Out Of The Woods

QTR’s Fringe Finance • 25 implied HN points • 27 Feb 26
💰 Finance Monetary Policy
  1. Wholesale inflation accelerated in January — core PPI jumped 0.8% for the month and is running around 3.6% year-over-year, well above the Fed’s 2% goal.
  2. The hotter PPI contrasts with a softer CPI, and that tension matters because rising producer prices can filter through to consumer prices over time.
  3. It’s premature to declare victory over inflation — the PPI data suggest inflation risks remain and policymakers should stay cautious.

The Specie Flow Mechanism

David Friedman’s Substack • 170 implied HN points • 07 Jan 26
💰 Finance Monetary Policy
  1. When countries use the same money, trade deficits cause specie (gold) to flow and change domestic price levels, and those price changes naturally push trade back toward balance.
  2. Capital flows can offset trade imbalances, so a country can run a persistent trade deficit if it attracts enough foreign investment; equilibrium is reached when a country’s trade deficit equals its net capital inflow.
  3. In a multi-currency world exchange rates adjust quickly while price-level changes under a single currency affect debtors and creditors, and governments or central banks can temporarily intervene with reserves or money supply but cannot sustain those interventions forever.

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 Monetary Policy
  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.

Liu Shijin urges RMB internationalisation to boost consumption, balance trade

Pekingnology • 75 implied HN points • 05 Feb 26
💰 Finance Monetary Policy
  1. China needs to boost domestic consumption to fix a demand shortfall, focusing especially on services and basic public services and raising incomes for rural and low‑income groups.
  2. The growth model should shift from investment/export‑led expansion to one driven by innovation and consumption, using ‘terminal demand’ to guide effective investment and letting inefficient capacity exit.
  3. Accelerating RMB internationalisation—by expanding the offshore RMB pool through RMB‑settled imports, making RMB settlement a market‑access condition, and developing offshore RMB financial products—can strengthen the currency’s global role and support domestic consumption growth.

In a Perfect World, Powell Would Not Be Fed Chairman and Trump Would Be President

Peter Navarro's Taking Back Trump's America • 2397 implied HN points • 08 Mar 23
🇺🇸 U.S. Politics Monetary Policy
  1. In a perfect world, Peter Navarro believes Jerome Powell wouldn't be the Fed Chairman and Trump would still be the President.
  2. Navarro discusses how Mnuchin convinced Trump to appoint Powell, who in turn negatively impacted the economy.
  3. Navarro criticizes Powell's policies and highlights the challenges of dealing with stagflation and the Federal Reserve's limitations.

The "worst possible outcome" for the Fed is an unnecessary recession, not reversing a cut

Stay-At-Home Macro (SAHM) • 1238 implied HN points • 24 Jan 24
💰 Finance Monetary Policy
  1. The Fed's main concern is avoiding an unnecessary recession, not reversing a rate cut.
  2. Inflation has decreased, but the Fed is hesitant to cut rates due to fears of inflation resurgence.
  3. The Fed should balance its mandate of stable prices and maximum employment to avoid causing an unnecessary recession.

A Fed Chair the Markets Will Love

Common Sense with Bari Weiss • 268 implied HN points • 01 Dec 25
💰 Finance Monetary Policy
  1. Kevin Hassett looks likely to replace Jerome Powell as Fed chair, and markets would welcome his nomination.
  2. He is less worried about market bubbles and investor exuberance, so AI and other hot stocks would probably keep rising under his leadership.
  3. That short-term market lift could create long-term risks, since continued loose policy might inflame bubbles and cause trouble down the road.

Three reasons the Federal Reserve is likely to cut interest rates soon

Noahpinion • 8647 implied HN points • 03 Feb 24
💰 Finance Monetary Policy
  1. The U.S. economy is showing strong signs of a soft landing with low unemployment, surging job numbers, high employment rates, and accelerating wages.
  2. Inflation has fallen back to the 2% target, providing a remarkable macroeconomic achievement.
  3. Despite the strong economy, there is speculation that the Federal Reserve might cut interest rates soon due to reasons like accelerating productivity growth.

Why Boom-Bust Cycles Validate Austrian Economics

QTR’s Fringe Finance • 25 implied HN points • 21 Feb 26
💰 Finance Monetary Policy
  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 Monetary Policy
  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.

More Lies About Trade Tariffs From the Chaos Monkeys

Brad DeLong's Grasping Reality • 253 implied HN points • 22 Nov 25
🇺🇸 U.S. Politics Monetary Policy
  1. Supporters of chaotic tariff policies are making internally contradictory claims—saying tariffs don’t raise prices while also arguing that removing them will lower prices—and they push for immediate Fed rate cuts despite inflation risks.
  2. Tariffs act like taxes that raise prices and reduce output and jobs, and models that assume steady tariffs understate the real damage because unpredictable, rolling tariffs and the resulting uncertainty amplify economic harm.
  3. The political tactic is not coherent argument but domination: rapid misinformation, media capture, and enforced doublethink are used to flummox opponents and shape public opinion rather than engage on facts.

Principles of Economics Made Clear (Part 3)

Photon-Lines Substack • 278 implied HN points • 20 Nov 25
💰 Finance Monetary Policy
  1. Information often isn't shared equally among people, which can lead to problems like moral hazards, where someone takes more risks because they are not fully responsible for the outcome, and adverse selection, where buyers end up with worse options because they can't tell the good from the bad.
  2. The economy's total production and income is measured by GDP, but while it's a useful tool to see how well a nation is doing, it doesn't capture things like happiness or well-being, which are also important.
  3. Inflation occurs when too much money is printed without a corresponding increase in goods, making each dollar less valuable, and this can create real hardships, like eroding savings and distorting economic decisions.

Solving America's Debt Crisis

Contemplations on the Tree of Woe • 2194 implied HN points • 07 Feb 25
🇺🇸 U.S. Politics Monetary Policy
  1. The U.S. is facing a serious debt crisis, with over $36 trillion in debt. This situation is dangerous and could lead to major economic problems if not addressed soon.
  2. The national debt has grown dramatically due to various factors like wars, tax cuts, and the COVID-19 pandemic. It’s now out of control and not sustainable.
  3. A proposed solution, the Chicago Plan, suggests that the government should only issue money without debt. This could help eliminate most of the national debt and create a more stable economy.

Homeownership “Wealth” Is A Fallacy

QTR’s Fringe Finance • 35 implied HN points • 13 Feb 26
💰 Finance Monetary Policy
  1. Housing is primarily a consumption good you live in, not a reliable financial investment, because ongoing costs like maintenance, taxes, insurance, and transaction fees erode any supposed appreciation gains.
  2. Policy proposals like large MBS purchases, allowing 401(k) withdrawals for down payments, mortgage portability, or ultra-long loans are economically misguided and tend to require more debt or money printing, distorting capital markets and favoring existing homeowners.
  3. Tapping home equity or inflating home prices doesn’t create net wealth—selling to realize gains is offset by higher purchase prices, fees, and loan liabilities—so policies that prop up housing prices end up shifting costs onto younger buyers and non-homeowners.

What Causes Stagflation?

QTR’s Fringe Finance • 19 implied HN points • 24 Feb 26
💰 Finance Monetary Policy
  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.

Media Notes

The Lens • 982 implied HN points • 22 Jan 24
💰 Finance Monetary Policy
  1. Stephanie Kelton discusses alternative ways to handle inflationary pressures globally
  2. Central banks turning to rate hikes may not be the most effective solution for managing inflation
  3. Raising interest rates can have unintended consequences and may not always lead to desired outcomes

Davos, The Dollar, and Donald

JoeWrote • 79 implied HN points • 21 Jan 26
🇺🇸 U.S. Politics Monetary Policy
  1. Trump’s confrontational foreign moves are eroding the rules-based international order and straining alliances, shifting geopolitics toward power politics instead of agreed rules.
  2. Global investors are losing faith in the U.S. as a safe haven, driving down the dollar and U.S. assets while pushing money into gold and non‑US investments.
  3. Attempts to politicize the Federal Reserve and pressure its leadership risk destroying central bank independence, prompting financial leaders to diversify away from U.S. assets and weakening America’s financial dominance.

Sacred Cows

The Lens • 904 implied HN points • 27 Jan 24
🇺🇸 U.S. Politics Monetary Policy
  1. Economists, market participants, pundits, and policymakers got some big things wrong in recent years, like the transitory nature of inflation.
  2. The public perception of elites may be that they often know nothing, even elites admit to being wrong on significant matters.
  3. There was a discussion on the impact of rate hikes on inflation, challenging the traditional narrative and the idea that monetary policy has no effect.

The Fed is only looking to past inflation, and that's a problem.

Stay-At-Home Macro (SAHM) • 805 implied HN points • 09 Feb 24
💰 Finance Monetary Policy
  1. The Fed is focusing only on past inflation, and this approach may lead to problems with monetary policy decisions.
  2. Recent data shows a rapid decrease in inflation over the past six months, suggesting a return towards the 2% target.
  3. Despite strong economic growth and high interest rates, the Fed continues to rely heavily on backward-looking inflation data for its decision-making.

Market Misreads Services Inflation And the BOJ

Japan Economy Watch • 1018 implied HN points • 04 Jan 24
💰 Finance Monetary Policy
  1. Market players and forecasters may be misreading the intentions of the Bank of Japan (BOJ) about inflation and wage data.
  2. The BOJ's ambiguous messages and contradictory statements are causing confusion in the market.
  3. Evaluating services inflation and wage hikes requires careful consideration of data and not jumping to conclusions.

Let's Look At Data

Points And Figures • 746 implied HN points • 31 Jul 25
💰 Finance Monetary Policy
  1. The Fed is politically influenced, as seen in their recent decision to keep interest rates unchanged, despite some members wanting to lower them.
  2. Recent PCE data indicates inflation is rising, which might justify keeping rates steady even in light of other pressures for cuts.
  3. Changes in tariffs are likened to taxes that can slow down the economy, and the current money supply suggests potential recession signs, complicating the decision on whether to ease rates.

So...Is The Gold Boom Over?

QTR’s Fringe Finance • 32 implied HN points • 10 Feb 26
💰 Finance Monetary Policy
  1. Foreign central banks sharply increased gold purchases starting in 2022 to diversify reserves away from the U.S. dollar, and that central-bank demand was a major reason gold rose so much.
  2. In 2025 individual investors piled into gold and helped send prices parabolic, but a hawkish Fed nominee and rate worries triggered a fast, large sell-off.
  3. The core story — countries wanting less dollar exposure — remains intact. Short-term drops may be temporary and more central-bank diversification could keep upward pressure on gold over the long run.

Gold & Silver: A Volatile Day, Not a Broken Thesis

QTR’s Fringe Finance • 47 implied HN points • 31 Jan 26
💰 Finance Monetary Policy
  1. A single sharp down day is normal volatility and doesn’t mean the long-term bullish case for gold and silver is broken.
  2. Large fiscal deficits and heavy Treasury issuance limit how long the Fed can stay hawkish, which tends to push real rates lower and support precious metals over time.
  3. The U.S. external financing imbalance and a softer dollar add structural support for metals, but crowded trades can unwind quickly so expect two-way volatility.

"Absolute Train Wreck": US Adds $481 Billion In Debt In 3 Months

QTR’s Fringe Finance • 31 implied HN points • 10 Feb 26
💰 Finance Monetary Policy
  1. The government has sharply increased borrowing, adding hundreds of billions in a few months and sustaining a new norm of over $2 trillion per year; at that pace the debt could grow by about $10 trillion every four years.
  2. Annual interest payments have topped $1 trillion and are set to rise, driven by large amounts of notes (2–10 year maturities) and a shorter average debt maturity that forces more frequent rollovers.
  3. This combination of rising debt and interest costs looks fiscally unsustainable and could force the Fed or Treasury into interventions that would weaken confidence and strain markets.

Top Links 825 Central bank independence in historical context. Where the robots are. Carbon technocracy & the psychoanalytic view of the good life.

Chartbook • 572 implied HN points • 10 Aug 25
💰 Finance Monetary Policy
  1. Central bank independence has a rich history and context, showing how it evolved over time.
  2. There are significant discussions about technology and automation, especially regarding how robots impact jobs and society.
  3. The conversation around carbon management and our understanding of a good life reflects deeper psychoanalytic views on our values.

Valuations Don’t Matter When Money Is Fake

QTR’s Fringe Finance • 61 implied HN points • 19 Jan 26
💰 Finance Monetary Policy
  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.

The Silver Market Just Nuked The Narrative

QTR’s Fringe Finance • 106 implied HN points • 27 Dec 25
💰 Finance Monetary Policy
  1. Silver's sudden, violent price surge is a clear signal that problems in the monetary system are showing up in markets, and it's more a systemic warning than a one-off trade.
  2. A rare convergence of falling real yields, Fed-cut expectations, central bank gold buying, new institutional demand, thin physical supply, and speculative derivatives created a squeeze that amplified the move.
  3. Precious metals are acting as an honest barometer of eroding confidence in fiat and central planning, implying a regime change driven by decades of loose monetary policy and rising deficits.

"Economy Is In Recession": Only 181k Jobs Gained For All Of 2025

QTR’s Fringe Finance • 20 implied HN points • 18 Feb 26
💰 Finance Monetary Policy
  1. Headline payrolls showed only 181,000 net jobs added in 2025 — about 15,000 per month — which is very weak and consistent with recessionary conditions.
  2. Large downward revisions removed roughly 1.2 million jobs from prior estimates, with monthly revisions averaging around 105k, making the recent labor picture much worse than initially reported.
  3. The year’s reported positive job growth depends largely on the BLS birth/death assumption (+1.15M), while actual measured job counts were negative, so most gains reflect model assumptions about new business formation rather than recorded hires.

How we could return to the productivity growth of the 1990s

Noahpinion • 4705 implied HN points • 18 Mar 24
💼 Business Monetary Policy
  1. Productivity growth is crucial for controlling inflation, maintaining a stable economy, and improving living standards.
  2. To boost productivity growth, a combination of macroeconomic factors like full employment, investment incentives, and stable supply-side conditions is essential.
  3. Three key factors that fostered productivity growth in the 1990s were full employment, high fixed investment, and stable supply with low inflation; replicating these conditions today would require strategic policy interventions.

Liberty Eroding, Gold Rising: 30 Years of Warning

QTR’s Fringe Finance • 27 implied HN points • 11 Feb 26
💰 Finance Monetary Policy
  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.

The True Price For An Ounce of Gold: $20,275?

QTR’s Fringe Finance • 36 implied HN points • 03 Feb 26
💰 Finance Monetary Policy
  1. If you divide the monetary base by Treasury gold holdings you get a "Gold Coverage Price" — using October 2025 numbers that comes to about $20,275 per ounce.
  2. The monetary base has ballooned while Treasury gold holdings have stagnated or fallen, so the implied gold price has risen sharply and would imply a large devaluation of the dollar if redemption were resumed.
  3. Making the dollar fully redeemable in gold would force fiscal discipline because new money couldn’t be created without more gold, but if markets doubted the switch a loss of confidence could trigger a crisis.

How to Look Smart On TV And Dumb in History

QTR’s Fringe Finance • 56 implied HN points • 20 Jan 26
💰 Finance Monetary Policy
  1. Financial media often mocks and belittles warnings about structural risk because their incentives favor keeping the party going, so being early on a correct call can look like being wrong.
  2. Persistent central-bank interventions, debt monetization, and yield suppression create market distortions that eventually unwind, with bond markets a likely pressure point when they do.
  3. Gold and miners acted like effective insurance against those distortions, outperforming equities and validating skeptics who warned about asset inflation.