Author Archive: Michael Kendall
Michael Kendall
April 11, 2019
Trump’s nomination of Steve Moore and Herman Cain to Fed Board positions has shaken up the Fed establishment. Moore is advocating a CRB (commodities) Index target while Cain has written in favor of a gold standard. A gold standard or…
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Michael Kendall
February 16, 2019
In January 2018, I saw a market inflection occurring due to Fed normalization. I wrote Market Memo: Market Inflection. The week I wrote it, the Dow hit 26,600 and then began a decline. Capital flows to where it receives the…
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Michael Kendall
February 15, 2019
The Fed creates money based on a monetary standard. Think of a monetary standard as the Fed’s carburetor that regulates how much liquidity gets injected into the economic engine. To maintain a standard requires adjusting base money supply to hit a specific…
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Michael Kendall
February 3, 2019
The clearest way to understand current Fed policy and its effect on markets is to view it through interest rates. Interest rates are the price of credit. Credit is not money. When a bank creates credit, it does not create…
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Michael Kendall
January 3, 2019
Measurement requires a standard of reference. We accept this universally in the mathematical and scientific world. Suggesting that the length of the meter or the volume of a liter be constantly changed and tinkered with would defy common sense. Money…
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Michael Kendall
December 22, 2018
Start with the basics of money. Money is not wealth, it is the measurement of wealth. All money does is value the exchange of goods and services—the productive economy—similar to any other basic unit of measurement in the International System…
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Michael Kendall
October 25, 2018
Trump Bashes the Fed Over Rate Hikes The Federal Reserve and the Holy Natural Rate of Interest The Federal Reserve is on a Monty Pythonesque search for the Holy Grail of natural interest rates—the Wicksellian natural rate of interest. As…
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Michael Kendall
October 22, 2018
Yellen’s Inadvertent Gold Standard Nathan Lewis posted an excellent piece on Forbes about gold’s correlation with the dollar during Yellen’s tenure as Fed Chair. Lewis asks the question, “have we effectively recreated the Bretton Woods gold standard system?” Bretton Woods linked…
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Michael Kendall
October 10, 2018
The first rule to understanding elections is the wisdom of the electorate. The electorate is always right. That is why democracy works. The population in aggregate is far wiser than any elite few. Political systems have evolved in a trial-and-error…
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Michael Kendall
September 5, 2018
A ratio of two ratios determines the dollar price of gold. Dollar supply (base money) ———————————— Dollar demand (base money) ——————————————————– …
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