Can the Fed Handle the Next Financial Catastrophe Arising from Politicians’ Addiction to Spending?

Institutional Risk Analyst editor R. Christopher Whalen has written an insightful article exploring the origins of the new liquidity crisis the Federal Reserve is now fighting, a crisis in which the U.S. government’s fiscal policies—how it imposes taxes and spends money—may have played a major contributing role.
Whalen provides a good primer for understanding a situation that one analyst has described as a potential “Black Swan event,” a catastrophic occurrence that is generally believed to be so unlikely that when it shows up, nobody is prepared to cope with it because it was too unpredictable.

For today’s liquidity crisis, a Black Swan

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