Hi from the Middle of America. Specifically, somewhere around Chicagoland. Let’s check in on a couple of things that relate to today’s wacky title.

Up Only

If you are HODLing your crypto, you are wondering what in the name of Sam Hill is going on? We are, too. We created something on the Metacoin site called the Growth Portfolio and it’s in the tank.

See here, where the folks at CoinGecko have a nice tool where you can track portfolios AND make them public.

Apparently, “Up Only” isn’t just a catch phrase, it’s also a way of life for those living in George Costanza’s “Opposite World.”

Anyway, your crypto holdings are likely meandering through the fog, and preparing for the next phase of our craziness: April 12, 2022. That’s when the new inflation numbers come out. And, while we don’t know what’ll happen to your crypto portfolio, it might not be a bad thing to continue to HODL. Because of what follows…

Inflationeering

We mentioned a couple months back that it’s about to suck, or it will suck to suck, or that giant sucking sound will be heard round the world.

We might have been a little off on our predictions — what’s a half-point among friends? — but the sentiment remains the same: we’re headed toward semi-permanent inflation.

Item One: the UN tells us that the World Food Price Index is way the heck up. Have you felt that at your local bodega, grocery chain, Costco, or Walmart? Who hasn’t?

Item Two: a quick look at the Trading Economics calendar (those folks do GREAT work) will tell you that some places are having a rough time with inflation. Like Brazil, for instance, which announced its figures this morning. Here’s where they are in relation to others near the bottom of the G20.

What’s more than a little frightening: Brazil’s forecast was a little off — 10.81% was the forecast but, again, what’s a half-point among friends? — and it’s spared from the bottom of the G20 thanks to two countries that seem to be synonymous with inflation and one country that started a war.

CPI: Washington

They've been gaming the system for decades. In fact, the calculation of the basket of goods changed AGAIN this year — these are the items that are used to figure the CPI and, subsequently, that basket’s cost is used to render the inflation number on both a year-over-year and month-over-month basis — which is why we call it “inflationeering” above. OR, if you like the title for this subhead, “CPI: Washington.” They’ll blame Putin for this crime; they’ll blame the supply chain or COVID for this crime. And they’ll tell you the crime isn’t THAT bad. Again, what’s a half-point among friends?

This time, though, watch for the setup from the apparatchiks over at Team Biden. The blame game underway — you can thank Putin for the prices at the pump, for instance; oh and those lockdowns in Shanghai are having an impact, too, because China doesn’t get off Scot-free — they will turn to what they believe is a three-pronged attack to fight inflation.

“Tighten Your Belts.” We’re all in this together, right? But unlike Jimmy Carter turning down the White House thermostat and wearing sweaters, D.C. types will tell Flyover Country to do our part. More than just about energy (more on that below) we’re looking at the really painful trips to the grocery store. What’s the grade below “Choice?” Expect to see more people seeking out “Select” grade beef.
“Avoid Fossil Fuels.” Because “fossil fuels are bad.” (It’s important to have a Boogeyman, as we’ll learn in the months ahead. Have several, actually. Really important.) Because the Merry Band of Messengers has to achieve Net Carbon Zero 2030 or whatever the goal is this week, they need Big Oil to be their Boogeyman; Big Natural Gas and Big Coal are also groups that could use targets on their backs.
“The Fed Must Act Now. Immediately.” This is The Most Dangerous Game. The Fed is going to have to cannibalize itself somehow. As former White House Budget Director (and current wise sage) David Stockman tells us, either the stock market will crash or inflation will come down. But both? Here’s Stockman in today’s Casey Research “Daily Dispatch” (in response to a question about the Fed’s next move):

Note that the discussion continued with it being much less about “twenty five basis points” and much more about “Oh My Goodness rates gonna skyrocket!” Get used to “QT” (“Quantitative Tightening”) instead of “QE.”

About Those NFTs

You may have heard that more US Dollars have been added to the Fed’s balance sheet during the pandemic than the Fed had ever had on their balance sheet. Sounds crazy, but here are the charts.

(MATH: $4,712,799,000,000 added since March 2, 2020.)

So yeah, it might make just as much sense for the Fed to start printing their own NFTs. See how much that asset class has grown! Here’s a story from Blockworks.

Trust us, if you’ve grown by 23,000% in one year, that’s the kind of business the Fed wants to be in!

Surely You Must Be Joking.

Yes, we are joking. (No, don’t call us “Shirley.”) You can buy one of our NFTs, sure; and the Fed can buy as many as they want. See below.

So here’s the TL;DR for this post:

Inflation Numbers get announced next week. We’ll predict a number close to 9% year-over-year (Guesstimate from Dave: 8.8%).
Spin Team works overtime to blame everyone else.
Fed needs to react by raising rates, and dramatically.
Stock Markets start to tank.

Set your calendars for 6:30 a.m. CDT for April 12. That’s when the fun starts.

The Saturday List

Will the Fed Print More NFTs to Counter…