Few folks have dared to pick up the pen to compare a beautiful bird to the dirty world of money.
But we know something they don’t… something too important not to share.
Forgive us if our little analogy fails. But this lesson is too rich not to try.
The common loon is a majestic bird. Its warbled early morning chime reminded us often that we weren’t the only ones awed by an Alaskan sunrise.
The waterbirds seem to define the coastal Alaskan experience.
But loons are, well, quite odd ducks.
It gets them in trouble.
You see, for as beautiful, fast and adept as the birds are, they have quite a flaw. They can only take off from water… and even then they have a tough time. They seem to have to walk on water to make it happen.
Put them on land, and they’re done for.
We all know folks like this. They’re good at one thing, so that’s all they do. Take them out of their element, and they’re in big trouble.
But what happens when those people are in charge of our money? What happens when the folks with the nation’s economy in their hands know how to take off… but only when their feet are in the water?
That’s exactly the sort of question folks are asking the Federal Reserve these days.
Your money – and therefore your Liberty – is at risk.
He Said What?!
Nearly every week we get a note from a reader who admonishes the Federal Reserve.
“End the Fed!” is the war cry of so many folks with our sort of views. And never before have their wishes been so close to reality… and yet so distorted.
If you didn’t catch the sound bite (after all, the mainstream media tends to not cover topics that force viewers to think on their own), Trump’s old pal and the director of the National Economic Council, Larry Kudlow, stepped out of bounds last week.
He put a bit of political pressure on the folks at the Fed – a move that has been considered taboo in a generation-long string of gutless administrations.
“My hope is that the Fed under its new management understands that more people working and faster economic growth do not cause inflation,” Kudlow said. “My hope is they understand that and they will move very slowly.”
Ah… but the man forgets to whom he speaks.
Telling the Fed to hold back is like telling a loon to waddle up to the beach and take flight.
It’s not going to happen. In fact, it can’t happen.
A loon needs water… and the Fed needs rate hikes.
It’s what they do.
Independent No More
We reckon the White House is taping up its wrists and preparing for a fight.
If Kudlow is right, growth will be “significantly faster than virtually any forecasters think.”
But Team Trump knows the Fed can stop that growth whenever it wants. It’s doing everything it can to juice the economy, and it knows rising interest rates are the force that can stop it all.
Economies don’t grow, after all, without the aid of cheap money.
That’s why the president and his gang are squaring up to Jay Powell and rubbing their biceps.
They want low interest rates. But they know, just as a loon has only one way off the ground, the Fed has just one tool in its toolbox.
It’s a notion that’s going to put the Fed to the test.
It’s created what Jay Powell, the Fed head, has called a “challenging moment” for his group.
“In this environment,” he said, “central banks cannot take our measure of independence for granted.”
Trump certainly isn’t.
He and his team are aiming for the Fed and what it stands for.
For those of us who have long looked at the Fed through a skeptical lens, things are about to get interesting. Liberty lovers could soon be witness to an evolutionary fight.
The loon, we say, is starting to see the flaw in its design.
In fact… our research shows that we could get a huge announcement from the Fed on September 26.
It could be Trump’s biggest win yet. It would give him full control of the economy.
But if you want to be a winner when the news hits, you must make five simple money moves right away.