Dollar Debasement Has Begun - Robin J Brooks | Substack
Dollar Debasement Has Begun - Robin J Brooks | Substack
Source: Robin J Brooks | Substack
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DW NOTE
Brooks is calling debasement when the dollar index sits at 102.6 and real yields are positive. The actual debasement is what the Fed did in 2020-21 — $4.8 trillion in balance sheet expansion while inflation ran to 9%. Now they're paying 5.3% on reserves while core PCE runs at 3.3%. That's not debasement, that's a positive real rate with a $2 trillion fiscal impulse underneath it. The currency isn't collapsing; the government is simply choosing to pay more interest than it collects in some taxes.