The G-7 left us wondering about the substance and Janet Yellen was more dovish than the headlines revealed. Chair Yellen raised the issue of increasing rates “in the coming months” and more importantly she invoked the idea of “social justice” in the role of economics. For three years I have discussed that Janet Yellen is a moral philosopher and in that mindset would be far more likely to allow WAGES to rise faster before moving to raise interest rates to slow the economy. I have no problem with the idea of a labor economist erring on the side of desiring an increase in wages in an effort for labor to claw back some advantage from KAPITAL. My question: Are market’s misjudging Chair Yellen in this regard and therefore mispricing risk? This issue will not disappear and needs to be put into the equation of interest rates rising sooner than later. There will be more to follow in regards to Janet Yellen’s invoking of the social basis of her mentor, Professor James Tobin. Enjoy the weekend and think about those who gave the ultimate sacrifice for the freedoms we so value and allows for social media to provide the free flows of thought.
Click on the image to watch me and Rick discuss the ways in which the central banks have distorted the debt markets.
Click on the image above to watch my interview with Financial Repression Authority.