patrick.net

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%

Those without assets are globohomo wage slaves: "You will own nothing, eat bugs, and be happy." This Christmas, give the gift to the kids that both feeds and protects - a Remington 1100.

zzyzzx says

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

Yep. Despite core inflation still a problem.

As far as inflation fighting is concerned, the Fed is now officially not much different than the Bank of Zimbabwe.

Start buying gold.

Transcript of Chair Powell’s Press Conference Opening Statement
December 18, 2024
Page 1 of 4

CHAIR POWELL. Good afternoon. My colleagues and I remain squarely focused on
achieving our dual mandate goals of maximum employment and stable prices for the benefit of
the American people. The economy is strong overall and has made significant progress toward
our goals over the past two years. The labor market has cooled from its formerly overheated
state and remains solid. Inflation has moved much closer to our 2 percent longer-run goal.

We are committed to maintaining our economy’s strength by supporting maximum
employment and returning inflation to our 2 percent goal. To that end, today, the Federal Open
Market Committee decided to take another step in reducing the degree of policy restraint by
lowering our policy interest rate by 1/4 percentage point. We also decided to continue to reduce
our securities holdings. I will have more to say about monetary policy after briefly reviewing
economic developments.

Recent indicators suggest that economic activity has continued to expand at a solid pace.
GDP rose at an annual rate of 2.8 percent in the third quarter, about the same pace as in the
second quarter. Growth of consumer spending has remained resilient, and investment in
equipment and intangibles has strengthened. In contrast, activity in the housing sector has been
weak. Overall, improving supply conditions have supported the strong performance of the U.S.
economy over the past year. In our Summary of Economic Projections, Committee participants
generally expect GDP growth to remain solid, with a median projection of about 2 percent over
the next few years.

In the labor market, conditions remain solid. Payroll job gains have slowed from earlier
in the year, averaging 173 thousand per month over the past three months. The unemployment
rate is higher than it was a year ago, but at 4.2 percent in November, it has remained low.

December 18, 2024 Chair Powell’s Press Conference PRELIMINARY
Page 2 of 4

Nominal wage growth has eased over the past year, and the jobs-to-workers gap has narrowed.
Overall, a broad set of indicators suggests that conditions in the labor market are now less tight
than in 2019. The labor market is not a source of significant inflationary pressures. The median
projection for the unemployment rate in the SEP is 4.2 percent at the end of this year and 4.3
percent over the next few years.

Inflation has eased significantly over the past two years but remains somewhat elevated
relative to our 2 percent longer-run goal. Estimates based on the Consumer Price Index and
other data indicate that total PCE prices rose 2.5 percent over the 12 months ending in
November; and that, excluding the volatile food and energy categories, core PCE prices rose 2.8
percent. Longer-term inflation expectations appear to remain well anchored, as reflected in a
broad range of surveys of households, businesses, and forecasters, as well as measures from
financial markets. The median projection in the SEP for total PCE inflation is 2.4 percent this
year and 2.5 percent next year, somewhat higher than projected in September. Thereafter, the
median projection falls to our 2 percent objective.

Our monetary policy actions are guided by our dual mandate to promote maximum
employment and stable prices for the American people. We see the risks to achieving our
employment and inflation goals as being roughly in balance, and we are attentive to the risks on
both sides of our mandate.

At today’s meeting, the Committee decided to lower the target range for the federal funds
rate by 1/4 percentage point, to 4-1/4 to 4-1/2 percent. We have been moving policy toward a
more neutral setting in order to maintain the strength of the economy and the labor market while
enabling further progress on inflation. With today’s action, we have lowered our policy rate by a

December 18, 2024 Chair Powell’s Press Conference PRELIMINARY
Page 3 of 4

full percentage point from its peak, and our policy stance is now significantly less restrictive.
We can therefore be more cautious as we consider further adjustments to our policy rate.
We know that reducing policy restraint too fast or too much could hinder progress on
inflation. At the same time, reducing policy restraint too slowly or too little could unduly
weaken economic activity and employment. In considering the extent and timing of additional
adjustments to the target range for the federal funds rate, the Committee will assess incoming
data, the evolving outlook, and the balance of risks. We are not on any preset course.

In our Summary of Economic Projections, FOMC participants wrote down their
individual assessments of an appropriate path for the federal funds rate, based on what each
participant judges to be the most likely scenario going forward. The median participant projects
that the appropriate level of the federal funds rate will be 3.9 percent at the end of next year and
3.4 percent at the end of 2026. These median projections are somewhat higher than in
September, consistent with the firmer inflation projection. These projections, however, are not a
Committee plan or decision.

As the economy evolves, monetary policy will adjust in order to best promote our
maximum employment and price stability goals. If the economy remains strong and inflation
does not continue to move sustainably toward 2 percent, we can dial back policy restraint more
slowly. If the labor market were to weaken unexpectedly or inflation were to fall more quickly
than anticipated, we can ease policy more quickly. Policy is well positioned to deal with the
risks and uncertainties that we face in pursuing both sides of our dual mandate.

On a technical note, we lowered the offering rate on our overnight reverse repo facility to
align it with the bottom of the target range for the federal funds rate—its typical configuration.
Technical adjustments of this kind have no bearing on the stance of monetary policy.

December 18, 2024 Chair Powell’s Press Conference PRELIMINARY
Page 4 of 4

The Fed has been assigned two goals for monetary policy—maximum employment and
stable prices. We remain committed to supporting maximum employment, bringing inflation
sustainably to our 2 percent goal, and keeping longer-term inflation expectations well anchored.
Our success in delivering on these goals matters to all Americans. We understand that our
actions affect communities, families, and businesses across the country. Everything we do is in
service to our public mission. We at the Fed will do everything we can to achieve our maximum
employment and price stability goals. Thank you. I look forward to your questions.

https://www.federalreserve.gov/mediacenter/files/FOMCpresconf20241218.pdf

That's nice Powell, but lenders are behaving otherwise.

AmericanKulak says

That's nice Powell, but lenders are behaving otherwise.

Mortgage rates went up instead of down on the fed news?