patrick.net

No.

No, they are being challenged by people who aren't impressed by them.

My guess is no. My opinion is that interest rates are still way too low.

Yes, the Fed will raise another 0.25%. Prepare for a recession is 2019, but we won’t know until the data come out in 2020. Man, I hope I’m wrong but too many indicators are converging and pointing to the likelihood of a recession in 2019.

Raise, with very dovish remarks.

Booger says

My guess is no. My opinion is that interest rates are still way too low.

Of course it is. If the interest rates go to 8% to 10% people's savings accounts will start paying out 3%.
You'll see people championing higher rates.
This will have a great affect on the economy even though the Media will tell you otherwise.
First the Greedy bastards will quit cornering every market using cheap money they got for damn near free. While killing mom and pops operations.
Second, the savers once they have enough money to "Play with" will pay cash for their entrepreneurial efforts without all of the Iwogian pressures to keep them out.

Yes you might get fired from your shitty Home Depot job, but Harry and Ann's Hardware store will need you in their store.

Delete every single thing you wrote, and replace with "Enrich the banksters" and you would be right.

Oh yeah, well the best way to get back at the bankers is not to borrow. Higher rates mean lower house prices and lower prices make paying off the loan (or paying cash) easier. Higher rates also means lower car prices and easier to pay cash for the car. Higher rates also lower stock prices, leaving more advantage to those who buy for long term value instead of speculating.

Also higher rates makes great partnerships between entrepreneurs and banks.

All they have to do is just pay off a finite amount of money, then the rest and the business is still all their's.
No members of the board telling them they can do this or they have to cut corners, you know would destroy your reputation and business.
It's your business you get to hire who ever you want, and leave it all to your family.

SBA Business loans were well vetted. and didn't have near the write offs that large corporations do with money they got from 401K investors.
You might not even realize it, one company in your index takes a dive. They just promote another company to over value to make up the difference.
So at that point you should have two companies doing good in your index. But in reality one tanked and the other got a social promotion.

That's not very sound. Private businesses are not driven by MOM or YOY profits like investors are. Banks aren't as interested. As long your company can stay solvent and keep the lights on and employees paid, they will defer.

Small businesses can hire a guy that worked for them for 12 years, and not be told by the investors. He can't because the Manager has to have a Corporate Gender Studies degree.

Cheap money is what sold this country out.

Trickle down economics really was a thing. People didn't believe it because they were too busy blaming the system than to get off their asses and stand in the stream.

Private companies can last 100's of years, at the same location and at the same size. Giving even more like minded entrepreneurs to set up shop in their Neighborhood.

Large Corporations financed and motivated by Investor's money have one goal, either make the worth of your company more by next quarter or shut it all down.
It's the end game of every company if the get successful enough. They eventually get to a point where they will never top last month's profits.

Another benefit of higher interest rates, is the Government is less inclined to borrow for deficit spending.

https://finance.yahoo.com/news/preview-feds-last-monetary-policy-announcement-2018-155802273.html

The Federal Reserve on Wednesday raised interest rates for the fourth time this year.

The Fed increased the target range for its benchmark interest rate by 25 basis points to a new band of 2.25%-2.5%, putting the Fed funds rate at its highest level since the spring of 2008. All ten voting members of the FOMC voted in favor of Wednesday’s decision.

In its statement, the Fed pointed to a labor market that has “continued to strengthen” and economic activity that is “rising at a strong rate.” The Fed did note the slowdown in private investment seen over the last several months, saying “business fixed investment has moderated from its rapid pace earlier in the year.”

Along with its latest policy statement the Fed also released an updated set of economic projections, which shows a downgrade in the Fed’s forecast for interest rate hikes next year.

Interest rates being higher don't benefit the consumer in any way and don't benefit investors either.

The purpose of the Federal Reserve is to use interest rates to cool down inflation. There is no inflation nor wage inflation presently to worry about.

Crude oil prices just fell for shit's sake. Energy is a huge cost of living item for Americans.

It's too bad that the Federal Reserve felt that they had to "do something" when things were OK.

It's as if the Federal Reserve were waiting for the best time to raise interest rates because later they won't be able to.

Oh well I guess it's another shitty week for the stock market.

CEEE-RASH!!!

I am going to miss that extra 500k from all of my inflated assets.

It's as if the Federal Reserve were waiting for the best time to raise interest rates because later they won't be able to.

Yep, raise them now so they can cut them later. Remember, the Fed loss the cut rates stimulus tool when rates were essentially zero.

Ceffer says

CEEE-RASH!!!

I am going to miss that extra 500k from all of my inflated assets.

Opportunity to pick up on the dip?

HeadSet says

Opportunity to pick up on the dip?

Traditionally, December is a terrible time to invest, as traders like to cut losses for the fiscal year tax break by selling off further. When this is compounded by a market that is already lower than earlier in the year, and lower than it began the year, this is a sure bet: stocks will fall further before the year is over. I’m going to dump mine and re-invest in January.
I did this before in December 2007, and it turned out to be a great move. I sat there in nothing but bonds watching as the market completely melted down over the course of 2008.

increasing interest rates increases the size of the payment that folks make on homes or cars when they buy on credit.

Those less than fabulously wealthy folks, the majority of Americans, have limited disposable income. And so what they can afford on credit goes down when rates go up.

Hence the housing market is taking it on the chin. Not a crash, but a cessation of increasing prices. And the car payment that was at one time doable for that new car is now undoable.

A slowdown in the rise of home prices, or even the air getting let out slowly, with a gradual decrease in home prices, is great if you don't own and are looking to buy. Not great if you own and want to maximize profits on the sale of the home.

And everything connected to rates has to readjust and it takes time for the ramifications to work their way through the system.

If there is a recession and rates are at zero, OMG!

willywonka says

And so what they can afford on credit goes down when rates go up.

And then prices have to match what customers can afford to pay cash for.

Was it so bad in 1965, 1975 when 90% of the population didn't have credit cards?

bible actually teaches one not to use credit cards, biblical truth, which is still true today.

Fortwaynemobile says

bible actually teaches one not to use credit cards, biblical truth, which is still true today.

Imagine, people might have to keep paying the layaway every 2-4 weeks with their spare income before they got the new TV again, the poor dears.

oh the Humanity.

TwoScoopsOfSpaceForce says

Fortwaynemobile says

bible actually teaches one not to use credit cards, biblical truth, which is still true today.

Imagine, people might have to keep paying the layaway every 2-4 weeks with their spare income before they got the new TV again, the poor dears.

oh the Humanity.

I think our society is just debt addicted. I haven't had credit card in years, and hope to never need one. I'm not rich, but personal responsibility really goes a long way. I see kids these days, very frivilous, very irresponsible, and they expect society to just bail them out if they fuck up.

Fortwaynemobile says

I haven't had credit card in years, and hope to never need one.

While laudable, you're unfortunately paying for everyone else's credit card. I have two credit cards (one personal, one corporate) that I pay off every month and in 20+ years have never carried a running balance on. The benefit comes from the points, rewards, miles etc. that these cards advertise as an ostensibly 'free' benefit. Of course they're not free; you're paying for it in the form of the added fee the credit card companies charge retailers, who in turn tack on to the prices of goods sold to you.

If you're paying cash for everything, you're still paying that fee (unless the retailer has two tiers of prices for cash or credit, which I've only ever seen at gas stations), which can definitely add up over time.

The credit card system isn't great, and of course it's lured millions of idiots into insurmountable consumer debt, but it is the system in place and it's best to use it to your advantage. I also like that my credit card account automatically generates expense reports with minimal effort. Makes my quarterly reports easy.

HeadSet says

Opportunity to pick up on the dip?

Eventually the market will remember what normal interest rates are.

Evan F. says

If you're paying cash for everything, you're still paying that fee (unless the retailer has two tiers of prices for cash or credit, which I've only ever seen at gas stations), which can definitely add up over time.

Only if the cc you're paying with doesn't offer any kickbacks. With 4% cash rewards for gas on some cards, paying 10c more per gallon with the card beats paying in cash every time cash price is above $2.40 per gallon. Which translates to "always" if you live in fucking CA.