Easy Money Has Hard Consequences

Real Vision: Finance & Investing

Real Vision

Business News, News, Investing, Business

4.1 • 1.1K Ratings

🗓️ 3 November 2022

⏱️ 31 minutes

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Summary

Yesterday, the Federal Reserve announced a fourth consecutive 75-basis-point rate hike, and Chair Jerome Powell aggressively pushed back against any thoughts of a “pivot.” Today, the Bank of England followed the Fed with its own 75-basis-point rate hike, even as it warned what would be the country’s longest recession ever has already started and will continue through 2023 and into 2024. The dollar is strengthening against the pound again, though the prospect of a “soft landing” stateside seems to be growing more and more remote. “The world is confronted with many new threats,” writes Vincent Deluard in his most recent newsletter, “and the next twelve months feel abnormally uncertain.” Deluard, the Director of Global Macro Strategy at Stone X, joins Ash Bennington for today’s Daily Briefing to talk about recent moves by central banks, his 2023 outlook, and his “Holy Trinity” picks for this market. We also hear from Andreas Steno Larsen about the natural gas supply situation in Europe this heating season and, more importantly, next winter. Watch the complete conversation between Andreas Steno Larsen and Maggie Lake here: https://rvtv.io/3DCRpvQ. Learn more about your ad choices. Visit podcastchoices.com/adchoices

Transcript

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0:00.0	Is inflation the painful medicine the global economy needs? Welcome to the Real Vision Daily
0:11.3	briefing. It's Thursday, November 3, 2022. I'm Ash Bennington. I'm joined today by Vincent
0:17.1	Deliard, director of global macro strategy at Stone X. Our Real Vision audience, of course,
0:22.5	knows him as one of the first inflationistas. Lots to talk about today. Before we get started,
0:28.1	a quick reminder, our live chat function on the Real Vision site is temporarily disabled.
0:33.3	Please drop your questions in the comments section on the Real Vision website in the live chat on
0:38.1	YouTube or a Twitter at Real Vision. Vincent, welcome back to Real Vision. Pleasure to be here,
0:44.7	my friend. Good to be here. We have you here in a pretty wild time. It's been a busy 24 hours.
0:49.7	Yesterday, the Fed hiked 75 basis points, Fed funds rate moving from 375,
0:55.5	moving to 375 to 400 as the target range. During the news conference, Chair Powell advised
1:02.5	the window for a softwend landing on the economy is narrowing. Today, Bank of England hiked 75%.
1:10.1	It's largest increase since 1989 rates moving from two and a quarter to three percent.
1:16.3	Moreover, the BOE warning of the longest recession since records have been kept the cost of living,
1:22.4	rising the fastest pace in 40 years, a whole lot happening on the central bank front,
1:27.7	a whole lot happening on the macro front. Vincent, how do you frame it all in your head?
1:34.4	Well, I mean, I've been in the inflation is more resilient and higher for longer camp. So,
1:42.1	obviously, I thought yesterday's best conference was great. He was on point. He was clear.
1:49.5	He needed to, I think the problem is the market. It's like a child who needs to be constantly reminded
1:58.1	of the same message. And that's what he had to do again yesterday.
2:08.3	Yeah, it's just going to be, you know, I have to stop believing in fairy tales.
2:14.2	Like these dovish people, this is not something that the third of a suggestion was going to happen.
2:18.0	There's nothing in the data at this point that suggests that it should happen.
	...

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