Apparently, things have gotten so abnormal on the monetary policy front that there is no one left in Washington who even remembers what normal is.
Anyway, that’s the message you got from Sen. Pat Toomey during the Banking committee hearings this AM as he blew kisses at the Fed Chairman—even as the latter was explaining that, contrary to impression, he is not actually Wall Street’s latest compliant bitch.
Not at all.
Instead, Powell agreed with Toomey’s GOP talking points that the US economy is in a good, nay, great place, and that the Fed is merely fixing to “use it tools” to keep it there.
But as we indicated in Part 1, that is surely some bizzaro theory of capitalism and central banking. If the US economy still needs the Fed’s training wheels in month #120 of the longest business expansion in history and on the back of a 50-year low in the U-3 unemployment rate and a 3.1% first quarter real GDP gain, when, pray tell, will it ever be able to function sans central bank “stimulus”?