{"id":655570,"date":"2026-08-21T14:25:00","date_gmt":"2026-08-21T14:25:00","guid":{"rendered":"https:\/\/buglecall.org\/?p=655570"},"modified":"2026-08-21T14:25:00","modified_gmt":"2026-08-21T14:25:00","slug":"lacy-hunt-feds-been-stealth-easing-since-december-3","status":"publish","type":"post","link":"https:\/\/buglecall.org\/?p=655570","title":{"rendered":"Lacy Hunt: Fed’s Been “Stealth-Easing” Since December"},"content":{"rendered":"

Lacy Hunt: Fed’s Been “Stealth-Easing” Since December<\/span><\/p>\n

\n

\u201cWe\u2019re seeing a major secular shift<\/strong>, that we\u2019re now moving into a period of capital shortage, as well as we\u2019re witnessing the end of the three-decade period of globalization, which led to significant disinflation.\u201d<\/p>\n

That prediction comes from Dr. Lacy Hunt<\/strong>, once one of the bond market\u2019s most prominent bulls and secular disinflationists. Well\u2026 no longer. He\u2019s now a seller of U.S. long-dated bonds <\/strong>and suggested during last night\u2019s discussion on ZeroHedge that he\u2019s eyeing gold favorably.<\/strong><\/p>\n

Lacy told Thoughtful Money<\/u><\/strong><\/a>\u2019s Adam Taggart<\/strong> and Brent Johnson of Santiago Capital<\/strong> that inflation is here to stay so get used to it and plan accordingly:<\/p>\n

\u201cThere will be intermittent episodes when the secular forces will fade, but the big picture is considerably different. We\u2019re going to have higher inflation. We\u2019re going to have greater volatility in inflation. The trend in interest rate is going to be higher.<\/strong> And we\u2019re going to have generally poor economic performance.\u201d<\/p>\n

Here were the highlights of Lacy\u2019s tour de force<\/em>, but we highly recommend the full 75-minute discussion<\/u><\/a> in its entirety:<\/p>\n

Net national savings \u201cvery close to zero\u201d<\/strong><\/h2>\n

Hunt began his case with two forces: a shortage of capital and the reversal of globalization.<\/p>\n

\u201cThe Federal Reserve cannot solve the capital shortage situation<\/strong>. They can increase the money supply, but to have physical investment you need saving out of income.\u201d<\/p>\n

Money printing and rising rates has an increasingly deleterious effect on private investment, which will be vital to keep up with the AI boom. Higher government bond yields means the private sector needs to work harder to compete\u2026 why take risk when Uncle Sam guarantees 5% or more?<\/p>\n

\u201cWe\u2019re financing artificial intelligence. We\u2019re building an expansion of semiconductors. We need to expand the electrical grid\u2026 We\u2019ve got a massive federal budget deficit that\u2019s deteriorating.\u201d<\/strong><\/p>\n

Atop that, Hunt said net national saving is \u201cvery close to zero.\u201d<\/strong> Net national savings is defined as the total amount of money saved by households, businesses, and the government minus the cost of replacing worn-out capital goods (depreciation)<\/em>.<\/p>\n

\u201cSo there is going to be this tremendous demand for capital, which suggests that real interest rates will have to rise. And because the overall inflation is going to be going up at the same time, that means that this will reinforce the rise in nominal interest.\u201d<\/p>\n

\n

pic.twitter.com\/66rt9KwvR1<\/a><\/p>\n

\u2014 ZeroHedge Debates (@zerohedgeDebate) August 21, 2026<\/a><\/p><\/blockquote>\n

Fed\u2019s been \u201cstealth easing\u201d since December<\/strong><\/h2>\n

Since mid-December, the Fed\u2019s balance sheet has expanded by roughly $200 billion. So for all the talk of a hawkish Fed, they\u2019re still a net buyer of Treasuries. Additionally, bank deposits and bank lending are up.<\/p>\n

\u201cBank deposits and bank loans in particular, they\u2019ve surged very dramatically <\/strong>since mid-December\u2026 so now you have an uptick in deposit growth and money supply growth, which in my opinion is moving further into the inflationary direction.\u201d<\/strong><\/p>\n

This kind of monetary support, Lacy argued, only creates a longer-term problem by encouraging investment in financial assets rather<\/em> than productive ones.<\/p>\n

\u201cWhen the Federal Reserve comes in and gives a signal to the market that they\u2019re going to support the stock market… then what that serves to do is it\u2019s a signal to the corporate managers that they should put more investment in financial assets and less investment in real assets.\u201d<\/strong><\/p>\n

\u201cBut here\u2019s the rub. It\u2019s the real assets that raise the standard of living, not the financial investments.\u201d<\/strong><\/p>\n

\n

pic.twitter.com\/ftZIUcCRMH<\/a><\/p>\n

\u2014 ZeroHedge Debates (@zerohedgeDebate) August 21, 2026<\/a><\/p><\/blockquote>\n

Watch Lacy’s full deep dive below or listen on the ZeroHedge Spotify<\/u><\/a>. If one of the longest running bond bulls is throwing in the towel\u2026 it might be time to pay attention.<\/p>\n

\n

https:\/\/t.co\/Vg3ZRZ4A9F<\/a><\/p>\n

\u2014 zerohedge (@zerohedge) August 20, 2026<\/a><\/p><\/blockquote>\n<\/div>\n

Tyler Durden<\/a><\/span>
\nFri, 08\/21\/2026 – 10:25<\/span><\/p>","protected":false},"excerpt":{"rendered":"

Lacy Hunt: Fed’s Been “Stealth-Easing” Since December \u201cWe\u2019re seeing a major secular shift, that we\u2019re now moving into a period of capital shortage, as well as we\u2019re witnessing the end of the three-decade period of globalization, which led to significant disinflation.\u201d That prediction comes from Dr. Lacy Hunt, once one of the bond market\u2019s most… Continue reading Lacy Hunt: Fed’s Been “Stealth-Easing” Since December<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":[],"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[20,23],"tags":[],"class_list":["post-655570","post","type-post","status-publish","format-standard","hentry","category-economic-empowerment","category-national-security","entry"],"_links":{"self":[{"href":"https:\/\/buglecall.org\/index.php?rest_route=\/wp\/v2\/posts\/655570","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buglecall.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buglecall.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buglecall.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buglecall.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=655570"}],"version-history":[{"count":0,"href":"https:\/\/buglecall.org\/index.php?rest_route=\/wp\/v2\/posts\/655570\/revisions"}],"wp:attachment":[{"href":"https:\/\/buglecall.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=655570"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buglecall.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=655570"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buglecall.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=655570"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}