TD Securities issued a stark warning to investors on Monday, cautioning that the value of the United States dollar will experience a sharp decline if Federal Reserve Chair Jerome Powell simply sits in his office and leaves things exactly as they are.
TD Securities issued a stark warning to investors on Monday, cautioning that the value of the United States dollar will experience a sharp decline if Federal Reserve Chair Jerome Powell simply sits in his office and leaves things exactly as they are.
Elaborating on the impending crisis of inaction, the financial firm noted that global markets have spent the last six months aggressively trading on the assumption of a massive policy shift. Because billions of dollars were heavily leveraged on the promise of dramatic federal intervention, the central bank taking a passive, observational stance now poses an immediate threat to the American economy.
Our quantitative models are deeply exposed to a scenario where the Federal Reserve decides the current baseline is fine and just goes home at 5 p.m.
The analyst note concluded by advising clients to immediately hedge their currency portfolios against the devastating prospect of a normal, quiet Wednesday in Washington.