Monetary Moves

The Fed raises the Fed funds rate to tighten both financial conditions and lending standards. They in turn result in reduced lending and investment, which leads to slowing economic activity, and usually a recession. Since the SVB debacle, financial conditions and lending standards have quickly tightened, and by the equivalent of a staggering 150bps, more than the sum of the Feds last three rate hikes dating back to 11/2/22.