Peter St Onge Podcast Ep 152 Weekly Roundup: Fed to Print $40 Billion per Month
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Dec 22, 2025 The Fed plans to inject $40 billion monthly into the economy, raising inflation concerns reminiscent of historical crises. Europe faces significant challenges, including a $150 million fine against Elon Musk for free speech violations and political strife amid energy shortages. In China, the property market is crumbling, exacerbated by high youth unemployment. Alarmingly, only 12% of recent college graduates find employment immediately after finishing their studies, with AI posing new threats to job prospects in the future.
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Fed Returns To Big-Scale Money Printing
- The Federal Reserve resumed large-scale balance-sheet expansion, announcing $40 billion monthly purchases to finance rising federal debt.
- Peter St Onge warns this marks fiscal dominance that risks rekindling high inflation if deficits keep growing.
Reserves Over Prices: The Fed's New Justification
- The Fed says purchases are to keep "ample reserves" and control interest rates rather than label it QE, but the economic effect is similar.
- Peter St Onge argues this preserve-for-markets approach makes inflation more likely and sustains a bloated financial sector.
QE Has Become Market Crutch
- Since 2008 the Fed has added about $5.5 trillion in QE, almost matching the dollar base that existed in 2008.
- Peter St Onge connects repeated QE bouts to market fragility whenever the Fed tries to withdraw liquidity.