Brian’s concern is that, if the Fed keeps marching on with QT it will eventually run into a banking crisis and overcorrect with liquidity provisions that are likely to lead to credit expansion and soon after inflation. There is a risk that the Fed will bumble into “too tight” and jump backwards in shock to “too easy”. Either the BTFP becomes permanent (another brick in the Yield Curve Control (YCC) structure), or they’ll have a liquidity crisis on their hands come the spring and they’ll end up providing emergency liquidity and then still end up with a permanent term repo facility.
Brian Pellegrini is the Founder of Intertemporal Economics and the firm’s Senior Analyst. Brian founded Intertemporal Economics in 2018, previously he worked with Bernard Connolly as a senior analyst at Connolly Insight, where he specialised in Geopolitical Event risk, Monetary Policy, Labour Markets and Energy. Prior to Connolly Insight, Brian was employed in various positions across Wall Street, including working with high-growth technology firms raising capital, structuring options trades and valuing asset-backed securities. Brian has an MBA from Columbia University, a Master of Science in Finance from North-Eastern University and a Bachelor of Science in Computer Science from Columbia University. He is also a CFA charter holder.
Intertemporal Economics uses an in-depth analytical framework, which is based on microeconomic foundations. This allows an understanding of endogenous factors and patterns of human behaviour that cannot be analysed using quantitative techniques alone. The firm’s research focuses on topics affecting economics, interest rates and asset prices in developed and emerging markets.
Please let me know if you would like to join this zoom event.