ICYMI – Fed’s Kaplan broke rank, wants to talk about tapering

Dallas Federal Reserve Bank President Robert Kaplan spoke on Friday:

  • “We are now at a point where I’m observing excesses and imbalances in financial markets,”  

Kaplan pointed at:

  • historically elevated stock prices
  • tight credit spreads
  • and surging house prices
And recommends:

  • “I do think, at the earliest opportunity, I think it would be appropriate for us to start talking about adjusting …”  purchases os the Fed’s $120 billion in monthly bond buys 

Pretty much all of the talking-head Fed officials have been falling into line with Powell on inflation being transitory and there will be no trimming of monetary stimulus any time soon. Kaplan and Vice-Chair Calrdia are the only ones, recently, who have stepped out of line. Kapaln said similar last month as well. 

Kaplan’s comments are getting some notice across early NZ and Australia, raising a few eyebrows. He even went further and said (again) he believes the Fed will have to hike in 2022.

Of course, he is a lonesome voice right now.

  Dallas Federal Reserve Bank President Robert Kaplan spoke on Friday:

This is an old pic of Kaplan at Jackson Hole. The Hole will become an increasing focus of the market chatterrers in the weeks and m o n t h s (through to late-August for goodness sake) ahead:

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