October 26, 2022
I want to read only facts and probabilities in one report.
Because the rest of today’s report lends itself to radical narratives that self-interested parties promote, I would hope to read their submission of possibilities and their plan in a separate statement that I would quickly dismiss.
So, I separated today’s BOC report as follows:
FACT:
* BANK OF CANADA LIFTS KEY LENDING RATE TO 3.75% FROM 3.25%
* MOST ECONOMISTS PREDICTED BOC WOULD HIKE TO 4%
* BOC SAYS STRONG USD BOOSTING INFLATION IN MANY COUNTRIES
PROBABLE:
* BOC SAYS THE DRAG OF RECENT RATE HIKES IS BECOMING EVIDENT
* BOC SEES ENTRENCHED INFLATION RISK, STUBBORN CORE PRICES
POSSIBLE:
* BOC SAYS THE ECONOMY IS STILL IN EXCESS DEMAND, JOB MARKET TIGHT
* BANK OF CANADA SEES STALLED GROWTH THROUGH MID-2023
* BOC: INFLATION RISKS BALANCED, BUT UPSIDE MORE WORRYING
AGENDA:
* BOC SAYS INTEREST RATE WILL NEED TO RISE FURTHER
* BOC AFFIRMS VIEW INFLATION RETURNS TO 2% BY THE END OF 2024
Just saying…
The bully pulpit of central banks has gotten far too powerful and interventionist in capital markets. The major central banks are private organizations accountable to no one. The SEC and any other securities regulator whose mandate is to serve and protect us investors have zero oversight or control on these central banks.
So, my response is to let them tell us facts or probabilities so we can best manage our investment affairs. They should be required to give testimony to the government every time they report on items I marked as Possible or Agenda. Then let the government advise us as to whether it agrees. In other words, investors need someone to be held accountable. Otherwise, we invest under impossible circumstances.