Most Reckless Fed Ever: “Real” Federal Funds Rate Now the Most Negative Ever | Wolf Street

The “real” interest rate on savings accounts and CDs is similarly negative in the -7.0% range. The real yield of short-term Treasury bills is similarly negative in the -7.0% range.  Even the 10-year Treasury yield, now at 1.7%, is -5.3% in real terms

Even most junk bonds are traded with yields below the rate of inflation. The average BB-rated “real” junk bond yield is -3.3%. Taking more risk, the average B-rated “real” yield is -2.0%.

What the Fed is doing is called “financial repression.”

The Fed’s year-long refusal to deal with inflation, while talking down and brushing off this worsening inflation, after having triggered it with its monetary policies, including $4.6 trillion in QE – let’s just stick to calling it money-printing – in 22 months, cements this Fed under Chair Powell as the most reckless Fed ever as seen by the “real” EFFR chart above and by the Wealth Disparity chart below.

Most Reckless Fed Ever: “Real” Federal Funds Rate Now the Most Negative Ever | Wolf Street