patrick.net

apex says

Al_Sharpton_for_President says

Grab some 13 week and 6 month US Treasuries and sit back and collect 5%/year, risk free.
$1 million invested means $50,000 in passive annual income, not bad for sitting on your ass, downing Margaritas, and munching on carnitas tacos

When you get 13-week or 6-mo t-bills, don't they mature at the end of that period? It is not guaranteed that you can roll them over at that interest rate into the future.

True. What I did was take the money that I wanted to keep in MM accounts, divide by 13, and invest that much into 13 week T-Bills. Now that I've done that, I just buy new one each week to replace the expiring ones. Yes it requires me to login and make a few clicks on a website each week. But it gets me more $$ than a MM account and is free of state taxes. If for some reason I ever needed the cash, I could just not purchase a new TBill that week (or purchase one of lower value). But I get Tbill rates and if I needed the cash, it's only a week away.

zzyzzx says

What I did was take the money

Yes, a classic ladder strategy. And it is risk-free.

zzyzzx says

Yes it requires me to login and make a few clicks on a website each week. But it gets me more $$ than a MM account and is free of state taxes.

Yes, and no $250k per account limit.

Federal Reserve holds interest rates steady, forecasts two more rate hikes this year.

The Federal Reserve held interest rates steady Wednesday, but officials signaled they are prepared to raise rates again this year to tame stubborn inflation.

The central bank maintained its benchmark interest rate in the range of 5%-5.25%, the first time since January 2022 the Fed made no change to interest rates following a policy meeting.

Fed officials did, however, raise their interest rate forecasts for this year, signaling rates could rise to as high as 5.6%, implying two additional rate hikes are likely this year. Three officials see rates rising closer to 6%.

"Inflation pressures continue to run high," Federal Reserve Chair Jerome Powell said at a Wednesday press conference. Getting inflation down to the Fed's target "has a long way to go."

Next year, officials see interest rates falling by 100 basis points to around 4.6%, higher than the 4.3% forecasted in March.

The pause announced Wednesday, Powell said, should not be considered a "skip." What it does do, he added, is give the economy more time to adapt to prior hikes while letting Fed officials see the "full consequences" of the banking turmoil that roiled the financial system in the spring.

"We have no idea what we are doing, and worry that even the lowly plebe is catching on," Powell said.

https://finance.yahoo.com/news/federal-reserve-interest-rate-policy-decision-june-14-2023-180115494.html

HeadSet says

No competent person in economics or finance thinks inflation is caused by corporate greed. Inflation, the general rise in prices across the board, has one and only one cause - the overprinting of fiat currency.

^^^^^^^^^ THIS

The FED injected trillions into the money supply - this is what you get.

https://finance.yahoo.com/news/federal-reserve-interest-rate-decision-july-26-150040841.html

The Federal Reserve raised the target range for its benchmark interest rate by 0.25% on Wednesday and left the door open for more rate hikes this year.
Wednesday's rate increase brings the Fed's policy rate, the fed funds rate, to a new range of 5.25%-5.50%, the highest level since March 2001.

zzyzzx says

The Federal Reserve raised the target range for its benchmark interest rate by 0.25% on Wednesday and left the door open for more rate hikes this year.

Good.

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PCE increased 0.2% from the end of June 2023 to the end of July 2023.

I think the Fed will not increase rates as long as the monthly increase average below 0.3% for a four-month moving average

PCE is more comprehensive of an inflation metric compared to CPI.

.

Once again, the Fed does the wrong thing and leaves rates the same.

Booger says

Once again, the Fed does the wrong thing and leaves rates the same.

Next meetings are 31 October and December 12. I suspect they'll raise the rate at least one more time to 0.25% from 5.5% to 5.75%.

The rate at 5.5% is already at the highest its been in about 22 years. If CPI and PCE stay below 0.3% monthly and 3% annually then they may keep the rate constant.

They said they won't raise as much in 2024 as they did in 2023. So, I assume it's only going to go higher.

Based on the Fed's "Dot Plot", they are forecasting one more 1/4 point raise in 2023 then a 1/2 point decrease over 2024.

Meanwhile... the 10 year jumped 8 basis points so far. The Fed doesn't have a stellar forecasting record. In the currency markets the dollar is crushing everything.

https://finance.yahoo.com/news/interest-rates-staying-higher-for-longer-means-at-least-through-2026-for-the-fed-100035115.html

Interest rates staying 'higher for longer' means at least through 2026 for the Fed

zzyzzx says

https://finance.yahoo.com/news/interest-rates-staying-higher-for-longer-means-at-least-through-2026-for-the-fed-100035115.html

Interest rates staying 'higher for longer' means at least through 2026 for the Fed

So that means no recession before 2026

How long can the yield curve stay inverted ? Schwab has 1 month CD's at 5.5%

.

ad says

Schwab has 1 month CD's at 5.5%

Thanks!

Rates remain the same. I'm OK with these current rates as long as they are never lowered.

Rates remain the same, again. I'm not convinced that they are going to raise them any more either, even though they should.

https://finance.yahoo.com/news/federal-reserve-leaves-interest-rates-unchanged-tempers-expectations-on-rate-cuts-ahead-190255912.html

Federal Reserve leaves interest rates unchanged, tempers expectations on rate cuts ahead

Rare freak occasion where the Federal Reserve does the right thing.

My PBR stock did not get hammered so I am happy

https://finance.yahoo.com/news/apollo-torsten-slok-says-fed-131511825.html

Apollo’s Torsten Slok Says Fed Will Not Cut Rates in 2024

Apollo Management Chief Economist Torsten Slok said that a re-accelerating US economy, coupled with a rise in underlying inflation, will prevent the Federal Reserve from cutting interest rates in 2024.

https://www.cnn.com/2024/03/01/investing/the-fed-may-not-cut-rates-this-year/index.html

The US economy is so strong that there might not be any rate cuts in 2024

https://finance.yahoo.com/news/boj-dovish-tone-first-rate-044641163.html

Japan Ends Era of Negative Rates With Few Clues on Further Hikes

zzyzzx says

https://www.cnn.com/2024/03/01/investing/the-fed-may-not-cut-rates-this-year/index.html

The US economy is so strong that there might not be any rate cuts in 2024

How come it doesn't feel strong?

GNL says

How come it doesn't feel strong?

Because it isn't. It's the news media covering for Biden.

GNL says

zzyzzx says

https://www.cnn.com/2024/03/01/investing/the-fed-may-not-cut-rates-this-year/index.html

The US economy is so strong that there might not be any rate cuts in 2024

How come it doesn't feel strong?

"Strong economy" is Donkey speak for "high inflation" when Biden is in power. Saying "We cannot lower rates when inflation is still high" sounds bad.

https://www.cbsnews.com/news/federal-reserve-meeting-rate-cut-march-2024/

The Fed is meeting this week. Here's what experts are saying about the odds of a rate cut.

With the central bank meeting Wednesday, economists and consumers alike have one question on their minds: When will the central bank start cutting rates?

The answer: Almost certainly not this month, and probably not at its next meeting, according to Wall Street forecasters.

zzyzzx says

https://www.cnn.com/2024/03/01/investing/the-fed-may-not-cut-rates-this-year/index.html

The US economy is so strong that there might not be any rate cuts in 2024

Lot of Tech companies are giving warnings about slowing growth for the next 3 quarters. Perhaps other sectors might be doing ok!

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Googl is at 147 and all time high was 148 in November 2021.

Likely 150 to 155 is the ceiling price in 2024 for Googl if the economy does not accelerate any more, unless Googl does more cost cutting.

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Annnnnnnnnnnnnnd the rate stays the same as forecasted. Still looking at (3) 25 basis point cuts in 2024, but looking at only (3) cuts in 2025 from a previous estimated (4).

https://finance.yahoo.com/news/federal-reserve-holds-interest-rates-steady-maintains-forecast-for-3-rate-cuts-in-2024-180231430.html

https://www.cnbc.com/2024/04/03/atlanta-fed-president-bostic-sees-only-one-rate-cut-this-year-occurring-in-the-fourth-quarter.html

Atlanta Fed President Bostic sees only one rate cut this year, occurring in the fourth quarter

https://www.cnbc.com/2024/04/03/feds-powell-emphasizes-need-for-more-evidence-that-inflation-is-easing-before-cutting-rates.html

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

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.