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Message
2
Posted on 4/10/24 at 11:55 am to TheWalrus
I feel the same way assuming prices would do the inverse and come down. Unfortunately that isn't the case, at least not yet. Housing for example is still very elevated while rates are at 7%.
Posted on 4/10/24 at 12:25 pm to Bard
quote:
I don't disagree as to Powell's hands being tied, I just think that how he's handled this thus far he's more likely to understand that the results of raising rates are going to be "less worse" than continuing to try to thread the eye of the needle. Already we're hearing talks about the possibility of no cuts this year (this after going from 3 cuts around the beginning fo the year to 2, now talk is bouncing between one and none/continued-pause). Within 2 months (if inflation continues to creep up) we'll likely be hearing talk of possible rate hikes and cuts for this year being completely off the table.
Pretty bad 10 yr auction just now, on a sh1tty day for yields, after a bad 3yr (freaking 3, not 30) earlier this week. Imo the only way they can raise is with simultaneous QE. Janet probably begged the Chinese to start buying again and they’re not doing it. Dxy just spiked to 105 which will stimulate more foreign UST selling. They’re just completely wrecked. The fiscal train flattened the Fed.
Posted on 4/10/24 at 12:30 pm to slackster
quote:
Everyone seems to agree that inflation is high and continued to climb, but few on here seem to agree with the jobs numbers being strong. People need to understand they’re pretty correlated.
We lost a big chunk of the labor force in 2020 when things were ripping. The "job loss" has already happened... you can't find people now for more specialized roles in my experience. So if you're the fed do you keep pushing at the risk of going overboard and causing a huge crisis, or do you start to lower rates for some shorter term relief and hope everything else catches up?
The current situation is unlike any other in our lifetimes and everyone should be wary of anyone claiming to know what is going to happen over the next couple of years.
Posted on 4/10/24 at 12:32 pm to LStU
quote:
Fed keeping rates too low for too long.
We need a rate floor around 3 or 3.5
Posted on 4/10/24 at 12:34 pm to SloaneRanger
quote:
Well maybe I misread it, but the suggestion in your post seemed to be that the jobs numbers are strong and healthy, and that is simply untrue.
I think both can be true (or as slack said, it's somewhere in the middle).
While a lot of job growth comes from p/t and going to illegals, we still aren't seeing the rise in Unemployment nor increasing jobless claims. To me, that says at least job availability continues to be strong (ie: job-hopping).
When looking at something like JOLTS we can see separations for private sector jobs has trended up, but only slightly. An ongoing increase in government jobs has been a big part of the jobs story for a while now, but their separations are actually trending downward (moving slightly more in a direction than private sector separations).
All that said, the jobs market's strength is no different than the brunt of GDP growth in that it's heavily dependent on the extra liquidity from continued private and public debt-creation. Once enough consumers hit their credit limit (which seems to be increasing, if I am reading this correctly, but it's my first time looking at that so if someone more versed with it wants to shed more light on it, that would be appreciated) and are forced to seriously scale back, we'll see how deep the problem of all this debt truly this is.
Posted on 4/10/24 at 12:41 pm to VolSquatch
quote:
So if you're the fed do you keep pushing at the risk of going overboard and causing a huge crisis, or do you start to lower rates for some shorter term relief and hope everything else catches up?
I don't think that's really the choices. I think it's more "do you keep pushing at the risk of going overboard and causing a huge crisis or do you start to lower rates and bring back even higher inflation?"
You don't lower rates in a strong GDP scenario. Regardless of the foundation, GDP is still expanding at a brisk pace. Lowering rates in that scenario adds more liquidity to the economy, thus driving up inflation (which is already starting to sneak back up because rates weren't brought up enough).
There's no way to get out of this economic calamity without significant pain (thus why a "soft landing" was more wishful thinking than achievable reality), it's just a matter of determining which vector the pain comes from, how much of it there will be and how long it will last.
Posted on 4/10/24 at 1:17 pm to Bard
Fed minutes released.
Nearly all participants anticipate cutting rates this year. (That was prior to this morning’s data, Mar 20)
Nearly all participants anticipate cutting rates this year. (That was prior to this morning’s data, Mar 20)
Posted on 4/10/24 at 1:20 pm to CecilShortsHisPants
Did I read correctly that Biden just stated that rate cuts may be pushed back a month or so but would happen before the end of the year. He couldn't have come out and said that, right?
Posted on 4/10/24 at 1:21 pm to Bard
Everyone knows what has to happen. Powell needs to hold firm on rates (if not push higher) and Congress needs to be put on the spot to do something about debt. It’s not going to happen though until there’s blood in the streets.
If Powell cuts into this inflationary environment just so we can afford the interest on our debt I’ll be seriously worried about what comes next.
If Powell cuts into this inflationary environment just so we can afford the interest on our debt I’ll be seriously worried about what comes next.
Posted on 4/10/24 at 1:21 pm to SloaneRanger
He did
Posted on 4/10/24 at 1:25 pm to SquatchDawg
quote:
He did
Holy shite, this is peak clown world.
Posted on 4/10/24 at 1:25 pm to SloaneRanger
quote:
Did I read correctly that Biden just stated that rate cuts may be pushed back a month or so but would happen before the end of the year. He couldn't have come out and said that, right?
Where did you read that? And why not? Its highly probable rates will be cut in 2024 whether you agree or not.
Posted on 4/10/24 at 1:31 pm to CecilShortsHisPants
I saw the clip…just happened about an hour ago at some outdoor WH press conference. He walked it back some saying nobody knows for sure what the Feds going to do.
And why would you say it’s highly probably with inflation closer to 4% than 3%?
And why would you say it’s highly probably with inflation closer to 4% than 3%?
This post was edited on 4/10/24 at 1:32 pm
Posted on 4/10/24 at 1:59 pm to SquatchDawg
quote:
And why would you say it’s highly probably with inflation closer to 4% than 3%?
1. FOMC is officially on record now saying they anticipate it.
2. We’re barely in Q2
I’d say its more likely than not, perhaps “highly probable” was an incorrect choice of words.
ETA: Trump will have no effect this year, I’m an idiot.
This post was edited on 4/10/24 at 2:24 pm
Posted on 4/10/24 at 2:13 pm to CecilShortsHisPants
quote:
3. Trump will likely strong-arm the fed into cutting.
How would this have any affect on this year?
quote:
I’d say its more likely than not, perhaps “highly probable” was an incorrect choice of words.
I think this is fair enough, but it is trending in the wrong direction.
Posted on 4/10/24 at 2:23 pm to thunderbird1100
You’re right, that didn’t make any sense…. let me fix it
Posted on 4/10/24 at 2:47 pm to SquatchDawg
quote:
Everyone knows what has to happen. Powell needs to hold firm on rates (if not push higher) and Congress needs to be put on the spot to do something about debt. It’s not going to happen though until there’s blood in the streets.
If Powell cuts into this inflationary environment just so we can afford the interest on our debt I’ll be seriously worried about what comes next.
I agree. It is kind of frightening how little ability there is in Washington to cut spending. We have outspent ourselves into a corner, and yet voters keep sending people to Washington that will push us deeper into a corner.
Posted on 4/10/24 at 2:53 pm to SloaneRanger
quote:
He did
Holy shite, this is peak clown world.
Yup, and nothing that happens in November will change it.
LINK
Posted on 4/10/24 at 2:53 pm to slackster
quote:
Everyone seems to agree that inflation is high and continued to climb, but few on here seem to agree with the jobs numbers being strong. People need to understand they’re pretty correlated.
The taylor rule?
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