No-one likes an economic correction, says Bill Bonner. But they are both “essential and helpful.” If left to its own devices, the market will sort out its own mess. But the Fed will never let this happen. And just like Japan in the 90’s, this will only draw out the suffering.
Despite the chaos on Wall Street, the Fed yesterday left its benchmark interest rate on hold at 2%.
Martin Hutchinson says the Fed has finally starting doing its job: putting price stability over Wall Street’s demands. Real interest rates are negative. This is feeding inflation. It also means Treasury bond yields - also currently below the rate of inflation - are too low and should begin to rise again.
Martin says investors can profit from this situation with the Rydex Juno Inverse Government Long Bond Strategy (MUTF:RYJUX).