Monetary Muddle...The Fed has never managed policy under its new abundant reserve system with inflation rising this fast. No one, even the Fed, knows exactly how rate hikes will affect the economy under this new system.

Respect the Bear... given the recent hastening by the Fed in the pace of rate hikes and policymakers' lack of focus on what they really need to do — a targeted and persistent reduction in M2 growth — we no longer think equities are going to reach a new high (an S&P 500 north of 4800) until one of two things happens.

50% or More? All eyes will be on the results of the Federal Reserve meeting on Wednesday...Powell made it very clear the Fed anticipated raising rates.

Reducing Our Stock Market Forecasts. Given the surge in long-term interest rates this year, the US stock market is now fairly valued for the first time in over a dozen years, dating back to the Panic of 2008.

Whipping Inflation. Ultimately, inflation is always and everywhere a monetary phenomenon, as the late great economist Milton Friedman used to say.

Focus on the Money, Not Rates. The bottom line is that monetary policy is still very loose and likely to stay that way. And investors need to follow the money: both M2 overall and the money the banks are getting from the Fed. For now, neither are bearish signs.

Housing: Heartburn, Not a Heart Attack. It is true that national home prices have soared in the past couple of years. However, so have construction costs.

Inflation Games. Inflation is a political lightning rod... Politicians blame war, or COVID, but the simple explanation is just too much money creation.

What the Feds "Should" Do. There is a time and place for gradualism in monetary policy, particularly when the unemployment rate is still above normal or when inflation is only a little above the Fed's long-term target. This is not that time and place.

Will Russian Sanctions Lead China to Sell U.S. Debt? The US debt that China owns is more problematic for China than it is for the US. Moreover, if China sells US debt because it fears sanctions, then it will likely sell European debt as well. In the end, it’s not the US that has a problematic conundrum.