Consumer Economy
No updates this week.
Credit & Rates
- Fed Balance Sheet (WALCL) 6.64T +59.4B (+0.90% w/w)
- Total Bank Credit (TOTBKCR) 18.95T +24.3B (+0.13% w/w)
- 30 Year Mortgage Rate (MORTGAGE30US) 6.15% -3 bp
- 3-Month Treasury (DGS3MO) 3.63% -1 bp
- 10-Year Treasury (DGS10) 4.18% +4 bp
- 30-Year Treasury (DGS30) 4.86% +5 bp
Money left the long end of the curve; losses in TLT this week were 0.81%.
Based on the yield distribution, bonds look to be predicting a (BOOMING) recession for 2026-2027, then inflation afterwards.
Bank credit, after suffering a big decline (-39B) in early December, has expanded for the last 3 weeks, pulling bank credit up to a new all-time high. From a longer-term perspective (% change y/y), bank credit has been ok, but not spectacular – minus the contraction in 2023-2024.
About that recession: the past four weeks look like it may be a trend change for money printing. Total over this period: about $105 billion, while this week’s money printing was $59 billion. That’s Real Money; $3 trillion if it keeps going at this week’s rate for a year.
- 2025-12-14 3.5B
- 2025-12-21 17.5B
- 2025-12-28 24.3B
- 2026-01-04 59.3B
I’m old enough to remember when the Fed started printing money back on September 8th, 2019. First it was 15B, then 81B, then 75B, and the printing continued until…6 months later: +356B (3/22), +586B (3/29), +557B (4/05). Somehow, the Fed was so clever, they started printing money six months before the PANDEMIC was declared, and three months before the videos of people “emerged” who were dropping dead in Wuhan, China.
The Fed must be staffed with Psychics and Remote Viewers. That, or … Mistakes Were Not Made.
Is the start of the most recent “mysterious money printing” in late 2025 a “temporal marker” for something untoward happening in mid-2026? Will “they” wait six months this time for the “real printing” to start – or is the event due to happen sooner?
The CME Fedwatch Tool projects a 17% chance of one cut on the January 28th meeting.
Currencies
The buck reverse-confettied this week, rising 0.46 [+0.47%] to 98.16, rising 3 days out of 4. The buck is back in a daily uptrend, but the (weekly) “bullish harami” candle wasn’t rated very highly. It’s too soon to tell if this marks the
by cmartenson 
