patrick.net

zzyzzx says

Fed’s Powell emphasizes need for more evidence that inflation is easing before cutting rates

How about deflation to get prices back to where they were three years ago?

Al_Sharpton_for_President says

How about deflation to get prices back to where they were three years ago?

never going to happen as the Federal Reserve will not sit by idly and let prices drop

if you are lucky, then you may observe income rise at a slightly greater rate than guvmint-reported inflation

AD says

if you are lucky, then you may observe income rise at a slightly greater rate than guvmint-reported inflation

That ain't gonna happen either. Not on a large scale anyway.

https://www.forbes.com/sites/dereksaul/2024/04/08/jamie-dimon-head-of-us-largest-bank-warns-of-8-interest-rates-along-with-recession/

Jamie Dimon—Head Of U.S.’ Largest Bank—Warns Of 8% Interest Rates Along With Recession

A chilly scenario for the U.S. economy, in which interest rates climb as high as 8% as the effects of the unprecedented monetary policy taken to combat inflation take hold, is still very much on the table, according to JPMorgan Chase CEO Jamie Dimon.

The odds of a goldilocks soft landing outcome for the economy are “a lot lower” than the consensus of a 70% to 80% likelihood, Dimon outlined in his annual letter to JPMorgan shareholders Monday.

Coupled with Dimon’s concerns about the potential for “stagflation,” a recession characterized by lingering high inflation, he warned interest rates could soar to “8% or even more,” a far cry from the already 22-year high rates of over 5% and going against conventional wisdom of a looming decline in rates (U.S. interest rates have not been 8% or higher since 1990).

Dimon explained there are several “persistent inflationary pressures” which could keep price increases sticky, including the rise in military conflict globally and the lingering effects of aggressive policy from central banks worldwide coming out of the pandemic.

The billionaire Dimon also warned about the potential for carnage for both equity and debt investors should a higher-rate scenario play out, noting stock valuations are already at their “high end” and credit conditions are “extremely tight.”

Dimon’s warnings come as investor sentiment looks rosy—major stock indexes sit at record highs as the market eagerly awaits lower interest rates. JPMorgan is by far the largest American bank by assets and market value, holding roughly $2.7 trillion in domestic assets by the end of last year. Dimon is worth about $2.2 billion, according to Forbes’ latest estimates, owing most of his fortune to his stake in his bank. JPMorgan grew its already massive book by 6% last year thanks in part to its May 2023 acquisition of failed regional bank First Republic, a takeover Dimon characterized Monday as “something that we would have done just for ourselves” but rather a decision to stabilize the U.S. banking system writ large.

Prices are

zzyzzx says

Jamie Dimon—Head Of U.S.’ Largest Bank—Warns Of 8% Interest Rates

Sounds about right.

https://finance.yahoo.com/news/fed-hiking-rates-6-5-164050747.html

Fed Hiking Rates to 6.5% Is ‘Real Risk’ for UBS Strategists

No rate cuts... until maybe next year ;)

zzyzzx says

https://finance.yahoo.com/news/fed-hiking-rates-6-5-164050747.html

Fed Hiking Rates to 6.5% Is ‘Real Risk’ for UBS Strategists

(Bloomberg) -- The combination of strong US growth and sticky inflation is raising the odds the Federal Reserve hikes rather than cuts interest rates, bringing borrowing costs to as high as 6.5% next year, according to UBS Group AG strategists.

Good. It is pay now or fuel hyperinflation later.

https://fortune.com/2024/04/16/fed-chair-jerome-powell-no-rate-cuts-this-year-markets/

Fed Chair Jerome Powell has an ‘unfriendly’ message for markets: You might not be getting any rate cuts this year

https://www.bloomberg.com/news/articles/2024-04-16/booming-us-economy-inspires-radical-theory-on-wall-street

What If Fed Rate Hikes Are Actually Sparking US Economic Boom?

As the US economy hums along month after month, minting hundreds of thousands of new jobs and confounding experts who had warned of an imminent downturn, some on Wall Street are starting to entertain a fringe economic theory.

What if, they ask, all those interest-rate hikes the past two years are actually boosting the economy? In other words, maybe the economy isn’t booming despite higher rates but rather because of them.

It’s an idea so radical that in mainstream academic and financial circles, it borders on heresy — the sort of thing that in the past only Turkey’s populist president, Recep Tayyip Erdogan, or the most zealous disciples of Modern Monetary Theory would dare utter publicly.

But the new converts — along with a handful who confess to being at least curious about the idea — say the economic evidence is becoming impossible to ignore. By some key gauges — GDP, unemployment, corporate profits — the expansion now is as strong or even stronger than it was when the Federal Reserve first began lifting rates.

Yep. I tell panhandlers now to bugger off and invest in Treasuries.

Al_Sharpton_for_President says

50, 75, 100?

It doesn't matter anymore. The only asset the fed controls is depreciating at an ever accelerating pace. Prison or freedom, that's all that matters now.

https://www.cnbc.com/2024/04/17/wall-street-pushes-out-rate-cut-expectations-sees-risk-of-no-action-until-2025.html

Wall Street pushes out rate-cut expectations, sees risk they don’t start until March 2025

zzyzzx says

Wall Street pushes out rate-cut expectations, sees risk they don’t start until March 2025

Too soon.

But the Fed Experts on PatNet said...

Mortgage Rates Pass 7% for First Time in 2024

Mortgage rates climbed above 7% for the first time this year as traders re-evaluated the odds for interest-rate cuts by the Federal Reserve. The average 30-year fixed mortgage rate this week was 7.1%, according to Freddie Mac It was the highest rate since late November, and the sharpest week-over-week increase since early June. Home prices kept rising in March, the National Association of Realtors said earlier this morning, adding to the difficulty of finding an affordable home.

https://finance.yahoo.com/m/a057fc09-5d77-3694-b5dc-9dad9f6732d2/mortgage-rates-pass-7-for.html

Al_Sharpton_for_President says

Mortgage rates climbed above 7% for the first time this year as traders re-evaluated the odds for interest-rate cuts by the Federal Reserve. The average 30-year fixed mortgage rate this week was 7.1%, according to Freddie Mac It was the highest rate since late November, and the sharpest week-over-week increase since early June

But the Fed Experts on PatNet said...

https://www.reuters.com/markets/us/feds-bostic-open-rate-hike-if-inflation-progress-stalls-2024-04-18/

Fed's Bostic: open to a rate hike if inflation progress stalls

UkraineIsTotallyFucked says

Al_Sharpton_for_President says

Mortgage rates climbed above 7% for the first time this year as traders re-evaluated the odds for interest-rate cuts by the Federal Reserve. The average 30-year fixed mortgage rate this week was 7.1%, according to Freddie Mac It was the highest rate since late November, and the sharpest week-over-week increase since early June

But the Fed Experts on PatNet said...

But the Fed Experts on PatNet three years ago said...

zzyzzx says

https://wolfstreet.com/2024/05/01/fed-holds-rates-at-5-50-top-of-range-qt-slowdown-starts-in-june-acknowledged-inflation-is-a-problem-again/

But the Rate Cut Geniuses on PatNet said...


https://wolfstreet.com/2024/05/01/oh-deary-where-did-my-rate-cuts-go-feds-wait-and-see-now-entrenched-and-suddenly-lots-of-talk-about-rate-hikes/

From what I could decipher from the 60 Minute interview with Federal Reserve Chairman Jerome Powell, the Fed will lower rates when the CPI's and PCE's 6 month average for annual inflation are below 3%.

AD says

From what I could decipher from the 60 Minute interview with Federal Reserve Chairman Jerome Powell, the Fed will lower rates when the CPI's and PCE's 6 month average for annual inflation are below 3%.

Their mandate is 2% average inflation. Emphasis on average.

zzyzzx says

Inflation had not been tamed. The Fed knows this. The average American knows this. Everyone knows this.

So other than some token cut, they can't lower them. If anything, they need to raise them again right after the election.

Those Op-Ed pieces claiming Fed needs to cut rates for all their bullshit 'reasons', are just propping up some special interests' agenda.

Feds cut rates a half a point.

zzyzzx says

Feds cut rates a half a point.

S&P 500 had priced this is, but its up 0.24% and hit an all time high today.

.

The housing collapse happens by the end of Q2 2025.

Homeloaners are expecting millions to start bidding on houses and it's not going to happen. Those who are able and willing to buy are saying "Ah... they Fed will cut rates MOAR next year, and what's the hurry with all the inventory piling on?"

AmericanKulak says

The housing collapse happens by the end of Q2 2025.

Homeloaners are expecting millions to start bidding on houses and it's not going to happen. Those who are able and willing to buy are saying "Ah... they Fed will cut rates MOAR next year, and what's the hurry with all the inventory piling on?"

We shall see when the 30 year mortgage drops to 5% and if there is enough competition among buyers next March, and how that translate to number of sales and inventory.

Recall the 30 yr mortgage rate was around 3% when prices peaked around 1st half of 2022.

If the rate is 5%, then that means prices should be 20% below the peak price based on the general rule there is a 10% drop in price for every 1% increase in the 30 year mortgage rate.

Granted, household income and wages increased since 2022 by at least about 15%.

.

Gold just did a fleeting kiss with $2600, before globohomo finance gave that bitch a good belly punch.

Once again, the fed does the wrong thing and lowers interest rates. This time by .25%

Yet still again, the fed does the wrong thing and lowers interest rates by .25%