Powell defends his first major monetary easing at a press conference, September 2019.[1]
High up on his [President Biden's] list, will be dealing with the consequences of the biggest financial bubble in U.S. history. Why the biggest? Because it encompasses not just stocks but pretty much every other financial asset too. And for that, you may thank the Federal Reserve.
Richard Cookson, Bloomberg (February 2021)[2]
The expression "everything bubble" refers to the correlated impact of monetary easing by the Federal Reserve (and followed by the European Central Bank and the Bank of Japan)[3] on asset prices in most asset classes, namely equities, housing, bonds, many commodities, and even exotic assets such as cryptocurrencies and SPACs.[4] The policy itself and the techniques of direct and indirect methods of quantitative easing used to execute it are sometimes referred to as the Fed put.[5] Modern monetary theory advocates the use of such tools, even in non-crisis periods, to create economic growth through asset price inflation.[a][4] The term "everything bubble" first came in use during the chair of Janet Yellen, but it is most associated with the subsequent chair of Jerome Powell, and the 2020–2021 period of the coronavirus pandemic.[3][6]
The everything bubble was not only notable for the simultaneous extremes in valuations recorded in a wide range of asset classes and the high level of speculation in the market,[7] but that its peak in 2021 occurred in a period of recession, high unemployment, trade wars, and political turmoil – leading to a realization that the bubble was a central bank creation,[3][8][9] with concerns on the independence and integrity of market pricing,[10][9][11] and on the Fed's impact on wealth inequality.[12][13][14]
In 2022, financial historian Edward Chancellor said "central banks' unsustainable policies have created an 'everything bubble', leaving the global economy with an inflation 'hangover'".[15] Rising inflation did ultimately force the Fed to tighten financial conditions during 2022 (i.e. raising interest rates and employing quantitative tightening), and by June 2022 the Wall Street Journal wrote that the Fed had "pricked the Everything Bubble".[16] In the same month, financial journalist Rana Foroohar told the New York Times, "Welcome to the End of the 'Everything Bubble'".[17]
^Cox, Jeff (25 September 2019). "The Fed will be growing its balance sheet again, but don't call it "QE4"". CNBC. Retrieved 16 February 2021.
^Cookson, Richard (4 February 2021). "Rising Inflation Will Force the Fed's Hand". Bloomberg. Retrieved 4 February 2021.
^ abcCite error: The named reference Bloomberg2 was invoked but never defined (see the help page).
^ abSummers, Graham (October 2017). The Everything Bubble: The Endgame For Central Bank Policy. CreateSpace. ISBN 978-1974634064.
^Metrick, Andrew (6 January 2021). "Interview with Sir Paul Tucker". Yale Insights. Retrieved 21 January 2021. It's no longer a Greenspan Put or a Bernanke Put, or a Yellen Put. It's now the Fed Put, and it's everything
^Cite error: The named reference Lachman1 was invoked but never defined (see the help page).
^Cite error: The named reference Bloomberg6 was invoked but never defined (see the help page).
^Cite error: The named reference Bloomberg4 was invoked but never defined (see the help page).
^ abCite error: The named reference NeueZurcherZeitung1 was invoked but never defined (see the help page).
^Derby, Michael S. (20 May 2020). "Fed's Mester Isn't Worried Central Bank Has Broken Market Pricing Ability". Wall Street Journal. Retrieved 17 February 2021.
^Cite error: The named reference FinancialTimes5 was invoked but never defined (see the help page).
^Cite error: The named reference FinancialTimes2 was invoked but never defined (see the help page).
^Saravia, Catarania (29 January 2021). "Low U.S. Rates Exacerbate Racial Wealth Gap, Paper Shows". Bloomberg. Retrieved 17 February 2021.
^Cite error: The named reference Reuters was invoked but never defined (see the help page).
^Cite error: The named reference Fortune was invoked but never defined (see the help page).
^Cite error: The named reference WSJJune2022 was invoked but never defined (see the help page).
^Cite error: The named reference NYTForoohar was invoked but never defined (see the help page).
Cite error: There are <ref group=lower-alpha> tags or {{efn}} templates on this page, but the references will not show without a {{reflist|group=lower-alpha}} template or {{notelist}} template (see the help page).
Reserve. Richard Cookson, Bloomberg (February 2021) The expression "everythingbubble" refers to the correlated impact of monetary easing by the Federal...
investor psychology. Large multi-asset bubbles (e.g. 1980s Japanese asset bubble and the 2020–21 Everythingbubble), are attributed to central banking liquidity...
the emergence of a so-called everythingbubble due to overuse of the Fed put and perceived simultaneous pricing bubbles in most major US asset classes...
for Credit? (2005, the credit bubble), and The Price of Time: The Real Story of Interest (2022, the everythingbubble). Chancellor was born in Richmond...
generally considered to have been the first recorded speculative bubble or asset bubble in history. In many ways, the tulip mania was more of a then-unknown...
A cryptocurrency bubble is a phenomenon where the market increasingly considers the going price of cryptocurrency assets to be inflated against their hypothetical...
The 2000s United States housing bubble or house price boom or 2000s housing cycle was a sharp run up and subsequent collapse of house asset prices affecting...
The Japanese asset price bubble (バブル景気, baburu keiki, lit. 'bubble economy') was an economic bubble in Japan from 1986 to 1991 in which real estate and...
Mark (January 16, 2020). "The Federal Reserve is the cause of the bubble in everything". Financial Times. Archived from the original on November 4, 2020...
A stock market bubble is a type of economic bubble taking place in stock markets when market participants drive stock prices above their value in relation...
de-trended forms. The indicator set an all-time high during the so-called "everythingbubble", crossing the 200% level in February 2021; a level that Buffett warned...
The Canadian property bubble refers to a significant rise in Canadian real estate prices from 2002 to present (with short periods of falling prices in...
savings in prospective railway companies—and many of those lost everything when the bubble collapsed and the companies called in the remainder of their due...
officials were monitoring trends but did not believe that a so-called "everythingbubble" was forming. On December 16, 2015, the Federal Reserve under Yellen...
portal Medicine portal Bubble Boy Bubble Boy, a 2001 comedic theatrical movie loosely inspired by this film Everything, Everything List of television films...
The Australian property bubble is the economic theory that the Australian property market has become or is becoming significantly overpriced and due for...
Reserve's everythingbubble". The Hill. Randall, David (September 11, 2020). "Fed defends 'pedal to the metal' policy and is not fearful of asset bubbles ahead"...
A filter bubble or ideological frame is a state of intellectual isolation that can result from personalized searches, recommendation systems, and algorithmic...
The Poseidon bubble was a stock market bubble in which the price of Australian mining shares soared in late 1969, then crashed in early 1970. It was triggered...
between Los Angeles-based blank-check firm Bright Lights and Manscaped. Everythingbubble List of investment banks Boutique investment bank "Guggenheim Partners...
original on July 18, 2010. Retrieved August 6, 2009. "Bunker's Busted Silver Bubble". TIME Magazine. May 12, 1980. Archived from the original on October 23...
The Irish property bubble was the speculative excess element of a long-term price increase of real estate in the Republic of Ireland from the early 2000s...
detached from economic reality, the Mississippi bubble became one of the earliest examples of an economic bubble. In France, the wealth of Louisiana was exaggerated...
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