There is little doubt that both 2020 and the 2020s will prove to be interesting times. Almost everything we have known from a global economic, market, political and social perspective seem to be in a state of flux vs. the broad norms that have existed for the better part of all of our lives!
“Politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly and applying the wrong remedies.” So why do central banks keep reaching for the elusive 2% inflation target?
“Be careful what you wish for, you may receive it.” Over the last several months, it feels as if all central bankers have used every speaking opportunity to mention that their monetary policies, including bond purchases (quantitative easing or QE) and negative interest rates (NIRP), have reached their limits. This is an extremely important development, because it means that today’s monetary policies are no longer as effective as they once were.