We have dedicated numerous articles and interviews addressing the dangerous strength of the USD on the heels of a deliberately hawkish Fed hiking rates into what is clearly a recession, official or otherwise.
Explaining the Inexplicable: Rising Rates into a Recession?
On the surface, such central bank tightening in the face of a tanking economy and increasingly volatile risk asset markets makes little sense, as a strong USD and higher interest expense (i.e., interest rate policy) crushes just about every asset class in its wake, from an empirically broken bond market and grotesquely over-valued stock market to the artificially repressed precious metals space.
So, why is the openly cornered Fed acting so openly at odds with the real world and the US economy after years of feeding it instant-liquidity at every “dip,” cough or market sniffle?
The Fake War on Inflation
The standard answer is to “fight” inflation (which the Fed’s own mouse-click money alone created).