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Name the top 3 biggest CB mistakes over last 10 years? I’ll get you started - ECB and the lamentable JC Trichet raising policy rates 2x back in 2011. My last real good hedge fund year +12%. Macro managers need CBs to make errors before they can make big money...
Bernanke's existential moment when 4 years after the largest fiscal and monetary stimulus ever and with abundant evidence that it had produced the most feeble of economic recoveries -unemployment at c 8%- he mused that they would almost certainly scale back their purchases of Ts
No one ever dared ask why and of course he never did follow through because investors erred more than the Feds - they almost doubled the 10 y rate to 3pc against a backdrop of tepid wage growth, an oil price crash and a wobbly china...2014 was my last double-digit return year...
And finally the Fed's desire to be loved again saw them ignore the natural rate of interest and hike 3x in 2017 and quarterly in 2018 taking rates to 2.5%. Memo to the Chairman - low doesn't always mean loose...But by that time i had packed my bags and left for St Barts.
