Will The Dollar’s Rise Crush Central Banks’ Plans?

Jack Farley welcomes back former senior trader for the Fed, Joseph Wang (“Fed Guy”), to analyze an action-packed week in which global central banks such as the Reserve Bank of Australia (RBA), the Central Bank of Brazil, and the European Central Bank (ECB) release their plans for forthcoming monetary policy. Wang explains why a continued rise in the U.S. Dollar relative to other fiat currencies would likely force other central banks to tighten at a rate they deem to be too fast. Farley fields questions from the audience regarding balance sheet run-off and pace of rate hikes, and he poses to Wang the eternal questions: “are reserves money”?

Joseph Wang’s writings can be found at: https://fedguy.com/
Joseph Wang’s Twitter: @FedGuy12
Jack Farley’s Twitter: @JackFarley96
Blockworks Twitter: @Blockworks_

Link to Blockworks’ newsletter: https://blockworks.co/newsletter/

00:00 Introduction
07:50 European Central Bank
13:10 Global Quantitative Tightening
17:42 Are Bank Reserves Money?
22:49 The Fed's Double Hike in March??
25:12 Balance Sheet Runoff
28:48 How Does The Fed Decide The Composition of Its Balance Sheet During QT?
31:18 Do Treasurys Hedge Equity Drawdowns?
38:52 The Dollar Milkshake
41:00 Why Do Banks Go Bust?
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