Editor's note: The brief excerpt below is from Hedgeye CEO Keith McCullough's morning research. For more information about Hedgeye's research products please click here.
Famed investor Warren Buffett told students at Georgetown University yesterday that, “The Fed is the greatest hedge fund in history.” He was trumpeting “how much money” the Fed makes. “It’s generating $80 billion or $90 billion a year probably… and that wasn’t the case a few years back.”
Isn’t that fantastic?
One of the greatest financial minds in US history is marketing a political message that is about as anti-Benjamin Franklin as it gets. Anti-savings that is. Where in God’s good name do you think these “profits” come from?
It’s time to get our money out of the Fed’s hands and back into the hands of The People. We know how to generate returns. We’re the ones who are going to be doing the hiring when we make money. All the Fed’s “profits” do at this point is tax the American consumer. It’s called Down Dollar driven inflation. It’s regressive.
The greatest threat to US growth recovering is the government intervening in the economic cycle. There has never been a sustained US economic recovery that did not coincide with:
1. Strengthening US Dollar
2. Rising US Interest Rates
Why doesn’t every discussion about the Fed start and end with that?