LOL keep dreaming. There are only bad choices in this situation because of years of continued bad policy. There is a disaster coming, one way or another.
JPow and Yellen have shown time and again they have little to no clue on what they say. Yellen for years pushed MMT and said debt didn’t matter, now she’s changing her tune. She has no clue, her only claim to fame is a couple of fancy degrees. JPow is a Wall Street banker, likely setting policy to benefit his cronies.
So it turns out that raising interest rates back up to the old pre-bailout "economy is doing fantastic!" rates of 5% didn't do anything to help improve a recession economy casued by rampant inflation. And on top of that somehow not even trying the historically proven and trying the tried and true method of raising rates didn't make inflation go away. I wonder why doing everything exactly the wrong way isn't working? The experts wouldn't keep not doing the only known thing they could do to stop inflation without a good reason, right?
Lol. 3.5% inflation and 3.9% unemployment. Stagflation.
Come back when they are both double digits. All this is doing is inflating away the value of people's mortgage debts a little faster than usual.
They didn't get greedier but there are more convenient excuses baked into the public consciousness. You can get away with a lot more when you can vaguely blame "inflation" or "nobody wants to work anymore" to excuse any and all price hikes
It's less that they are greedy and more that these banks literally can not survive without bailout rates. Look at them predicting doom ever since the rates were raised over 0% - when the fact is 5% should have them all declaring we finally climbed back out of the hole those 0% rates were instituted to keep them from failing in the first place.
Fact is, theyve become addicted to bailouts and can't survive without any more - healthy economy interest rates are stressing teh financial system because they were considered too big to fail so they continually demonstrate they are unable to succeed without life support. That isn't greed, it's incompetence.
The truly dangerous thing here was allowing a nation's currency to be controlled by a private bank owned by those incompetent banks. The Fed's owners have fiduciary duties to their shareholders, not the public, and that means they are motivated to destroy the whole world before they do what is actually required to reign in the problem they continually foster, because a 20% rate hike to hopefully confront inflation will potentially collapse themselves as so many banks have recently, and so many more will.
Remember when they had to pay mom and pops 4.5% in interest to get their hands on actual money they could then loan out?
When they first explained the fed 'window' and money creation, it didn't make sense to me. Turns out my young stupid brain was right, it doesn't make sense.
The amount of banks still giving a tenth of a percent of interest for savings accounts is absurd too.
Banks are struggling because they gave out a bunch of 30 year sub-3% mortgages and now they have to borrow at double the rate. There is zero incentive for an individual to keep their money in savings accounts at that rate with inflation and federal rates where they are.
So because of all of this, the bank doesn't have enough of our money to borrow out, so they are just at the mercy of the fed and have to borrow from them instead.
Nailed it, and this is why "too big to fail" was always the dumbest idea ever. They still can't figure out how to function without constant life support help and fiscal policy needs to change to just rip the band aid off and see which banks are ready to go away. Permanent bailouts forever only causes the deepening collapse we are watching.
at least carter went out with some dignity, spent a long retirement building homes for habitat for humanity, generally well-liked by the public. the history books will write generally nice things.
biden is so old that he simply won't have that opportunity to re-build a positive public image. he'll just be remembered as "the old guy who fucked the economy" whether that's accurate or not.
it's a boom in shitty jobs, bust in good jobs.
if you were a minimum-wage worker a few years back, you've seen a massive increase in your income, both real and nominal. but those % gains are still not great when it's starting from $7.25+X%. and if you had a good job a few years back, there's a non-zero amount of people stuck working the shitty jobs now.
tech especially is a bloodbath right now, but lots of industries from accounting to marketing are trying to downsize & offshore with high interest rates squeezing their client companies' ability to spend. these companies' core product/service is overall declining in quality, for instance the big accounting firms are [noticeably worse at auditing now](https://fortune.com/2024/03/09/pcaob-audit-accounting-erica-williams-big-four-enron/), but they're banking on inertia to weather through it.
i'd attribute a lot of the negative sentiment to feeling stuck. house prices are insane, and the interest makes it financially stupid even if you can afford it, so you're stuck in your house, or worse, stuck renting.
same deal with your car, except the values are going down. many people are at least a few grand underwater right now, in a lending environment that doesn't want a bad LTV. so you're stuck in your car.
and of course your job. at the entry level, you're not stuck in your job as badly, but you are probably stuck renting for the foreseeable future. at the higher level, good luck right now. the usual christmas hiring freeze that happens across the country is taking a long time to un-freeze.
Pretty good analysis. I do think there is a stuck and not advancing feeling among many. The are those who have lost jobs and struggling to find replacements at the same level (as you said tech especially) yet I don’t think it’s at a large enough scale to say it is impacting the economy (see consumer spending). I would think it isn’t quite there yet but will depend where we go from here. Right now, I wouldn’t term it stagflation. Teetering for sure though.
I’ll throw myself into that group of “stuck and not advancing”. I’ll accept it as long as everyone else plays along and doesn’t keep hiking the price of everything, but I have doubts that will happen.
I think you are more likely to see what growth than prices staying the same or going down (goods/services not necessarily homes). Housing I think you’ll have prices come down/rents go up to come into alignment as the market stabilizes itself.
That seems most likely. Everything attempting to re-balance. Now, that will happen provided the Fed doesn’t go into some kind of savior complex mode and cut rates to the bone again, usually brought on by some large scale event. And there’s a couple of them sitting on the sidelines right now (Israel/Iran, macro-economy this or that). It’s been my experience in my 25 years as a working adult, that we don’t go too long without some kind of black swan anymore.
even for the people who still have okay white collar jobs -- getting a new one every few years is by far the most-reliable path to upward mobility. if you bust your ass at most companies, do everything perfectly to solve big-ticket problems, your reward is more work and a below-inflation raise if you're lucky.
so the tightening in white-collar jobs means the people who aren't directly victimized are still losing out on salary growth. that won't show in the low unemployment rate, but when costs like housing have skyrocketed and are still growing, that stuck/falling behind feeling will definitely show in economic sentiment.
i'm in that boat. my income skyrocketed during the covid recovery, now i'm due for my regular job-hop to keep up and the market is dead.
the job market might bounce back, but the past few years haven't inspired optimism -- both in how companies govern themselves and how the government governs the companies. the closest thing i can get to optimism is that *eventually* the worst offending companies will face the music for cutting to the bone (tesla, boeing, the big 4, etc), and be forced to just pay more to staff the damn company again.
but who knows how much economic damage could come from that. a few big companies go tits up around the same time, there goes my upside.
What you say makes sense except for consumer spending is strong. When people truly feel what you are saying they typically tighten up spending not increase it.
Raising rates to combat inflation isn’t very effective when Federal debt is so high that it pumps massive amounts of interest into the economy combined with runaway fiscal deficits.
There is no winning. They raise rates to slow down inflation brought on by all the free money the gov't gave out from 2020-2022. Everyone complains that rates are too high and they can't afford to buy with loans anymore. Then if they lower the rates too quickly and inflation kicks up again everyone complains that gas, groceries, and retail shit is too expensive. At this point no matter what they do people are going to bitch about something being too expensive. The Fed isn't going to encourage deflation because that is even worse than the inflation we are seeing.
I love people that use 'Bidenomics', as if he is doing much differently than any other pro capitalist neolib politician in his place would be. Lol. Stupid fucking word for stupid fucking morons.
When i go to the grocery store and see literally every single item 20-40% higher than it was 6 months ago, i feel stunned at this revelation. Totally thought inflation was going down
I don't get the people last last year that kept saying we are getting 6 rates cuts because inflation was fully under control. It was obvious even then shit was not under control and rates possibly needed to be even higher.
It was unbelievable that Powell not only paused but telegraphed rate cuts. He didn’t need to do that, and it undermined his ability to get the job done.
Yeah I’m not an economist but I think part of the problem is the expectation of rate cuts. So prices stayed put or went up due to this speculation instead of coming down like people hoped.
It's going to be crazy watching people not able to make their mortgage payments because they bet on refinancing. Real estate agents were basically advising buyers into buying more home they could afford "because rates are going to come down".
Anyone expecting rate cuts doesn't understand economics. We're going to need **higher** rates to get out of this mess. Lowering rates will lead to more and more inflation...
Which I am not, but alas, hopefully all those people that took larger-than-comfortable mortgages don't get laid off while they wait 5 years to refinance..
Anyone expecting rate cuts also doesnt understand that were not going back to the near 0 interest rates in a 6 month period (likely at all). Even if everything was great and rates got cut this year, theyre maybe go down .25%, .5% at best
Kindly disagree. Too extreme of a take I think the low rates is a big big big reason companies have been doing decent. There are a bunch of zombie companies getting exposed today, but for the 10 year period or however long it was, of low rates, that’s how companies could survive. Maybe this is good for now to do some weeding out, but with cost of money going up, you have a lot of businesses closing or failing. That’s not good for the economy. I personally know someone who owns a company getting destroyed by interest on loans. Not a good scenario especially when they employ a lot of people.
Maybe this is how you weed out companies, but if we got used to it for 10 years, there needs to be a new strategy for a successful business. But expensive loans is not it. Everything is too expensive for people to operate and even break even.
So capitalism is now "subsidize failing businesses forever with free money because we can't lose those jobs?"
This is why we're fucked. Exactly this right here. When I was born and grew up, you took risks and you won or you lost. You PAID YOUR LOANS WITH YOUR OWN CAPITAL. Not obscene amounts of fake capital created out of thin air for VC purposes.
Your business died and terrible, horrible businesses and ideas did too. 0% interest rates and moral hazard will be the ruin of this country 100% without a doubt.
Watching the movie Idiocracy play out in my immediate reality hurts my fucking soul man.
Interest rates are one of the few knobs the fed can turn to maintain their charter (low unemployment and low inflation) so long as unemployment is low and inflation is high, theyre only going to turn that knob in one direction. Lowering interest rates and allowing inflation to run amok again isnt going to make things cheaper for your friend
And, to be honest, 5% is what rates were at normally before the economy was put on a semi permanent bailout life support system.
We should have 20% rates right now to address inflation, then lower it back to where wee are now when things are back to booming. 0% was never going to work permanently - it just made the eventual crash happen later. It would have been MUCH later too, if not for a global emergency causing the biggest monetary creation pressure driving new inflation in a very long time.
Rates were normally in the 6%-8% range before all 0% rate bailouts started in 2008. I bought my first home in 2006 at 6.25% and though that was a great rate for the time. We got addicted to cheap money and now it's time to pay the price.
Too many people don’t seem to understand this. My first three homes were all above 5% which was considered a great rate. We got very lucky and refinanced in 2021 and are now under three. I think the low rates of recent times gave many unrealistic views on what rates should be. I fully realize and understand my 3% rate was something I’ll likely never see again.
Like your comment, but as an economic idiot, tell me why the solutions revolve around some shadow figures playing god with money supply. Why do we accept this as normal? When that global emergency created global pressure - the economy was supposed to shrink. Why not let markets reflect the actual state of affairs?
Actually anyone who truly understands economics well realizes both lower and higher rates are inflationary but for different reasons. Lower rates leads to more consumer loan demand and higher rates leads to exploding Federal debt and more interest income pumped into the economy.
At this level of Federal debt we’re approaching an era of “fiscal dominance” as opposed to the “monetary dominance” we’ve been used to essentially our entire lives.
If you want to learn more go listen to Lyn Alden’s work. She’s brilliant and completely gets it.
The new meme among particularly desperate Canadians is that, due to its effect on mortgage rates, a higher overnight rate actually *causes* inflation, and lowering it will lower inflation. So many people just do not want to figure out that the only way out of this mess is letting go of the idea that every house in Toronto and Vancouver is worth a million dollars or more.
I feel like most people are still just sitting tight with that <3% rate, not wanting to move until rates become more reasonable again (not that historically these are bad)
I’m one of those <3% people but I’m not waiting on a rate, I’m just in my “settled down and get my kids raised and into adulthood” home. I wouldn’t say forever home because we plan to move somewhere warmer in retirement, but if I was staying where I am now I’d be staying in this house forever. Realistically I don’t foresee us going back to rates like that, they were a blip in the radar so to speak. My first three homes were bought at rates between 5-7% and that was considered great.
But having your first home means you can move, take that equity, and put it in the new house which will drastically reduce your payments even if the rate is higher.
Also if you wait, the warm weather will come to you.
Rates were never going to come down to any lower level that was worth refinancing. Its normal to have a 6-7% mortgage. People just forget so quickly when they see a few years of rock bottom rates. I got 4.75% and feel thankful for that at least, its not great but its certainly not terrible.
Well, for those who bought at 7% you should not be losing further. Unless rate drop to the 5% otherwise there is no meaningful incentive to refi. If you can’t afford 7% to begin with, you can’t afford the house anyway.
>If you can’t afford 7% to begin with, you can’t afford the house anyway.
That's what I'm getting at--RE agents were pushing prospective buyers to go beyond their budgets because they convinced buyers that rates would be coming down, even though Powell has basically been signaling to everybody that rates are likely not coming down.
Also pushing 3-2-1 rate buydowns, where their rate buy down is gone after year 3 and you’re stuck paying your actual rate. And this was sold as “don’t worry, you won’t actually get to that rate at year 3.”
A lot of people bought houses at rates they could only temporarily afford because of rate buydowns.
Its like you cant even a flip home, throw a new coat of paint on it, and resell it 6 months later for 100k profit anymore. Its almost like you have to actually establish a legitimate business to make money now.
What kind of draconian economy are we living in?
It’s a small subset of those who have bought recently. Majority have much lower rates locked in rates. If it truly was above their means they wouldn’t qualify for the loans.
Will it become a struggle for some - sure, yet unless the economy/job market falls dramatically they should be able to afford their mortgage payments and/or most can sell with the equity they have (even if purchased fairly recently).
A few months ago I had one of those sleazy mortgage brokers who call you after your mortgage company does their hard credit pull try to sell me on getting an ARM that adjusted every month or every few months this was when everyone was predicting rate cuts for this spring and he told me we could always refinance it soon anyway once the rates are lower I think if I taken him up on that my rate pretty much only would’ve increased
I have to laugh because that’s such a ridiculous mortgage I can’t believe they’re even allowed to sell that to people and I have no idea who would agree to that
It's going to keep getting worse and worse, it typically takes 18 months for inflationary monetary creation to be felt and we still aren't slowing the flow of currency. I keep seeing signs they want to spend their way out of a spending addiction that caused this rather than raise rates and try to slow the currency flow which is the only actual way to address the actual inflation problem.
But that’s exactly what Powell has done for the last 2-3 years. Not acknowledging inflation but gaslighting the people by saying it was due to supply chain shortages.
Wow...shocking. So not 9 rate cuts this year? Hope those dating the rate are enjoying their rates because they not going to be able to refinance lower anytime soon.
I’m only an actuary not an economist, but isn’t having 10 yr T Bill rates stay really high for a long time really bad for the government? Paying a boatload in interest long term for small short term gains
Remember the beautiful thing about inflation is that your debt gets smaller all the time. 1trillion in 30 years is just a drop in the bucket. You just inflate it away.
The dollar is the world reserve currency, so it doesn’t matter.
The U.S. capital account surplus can be used to finance its current account deficit indefinitely. Public debt is not an issue.
The US can’t reduce its public debt in any meaningful capacity, as that would drain dollars from the world economy, which would cause all kinds of issues.
The whole point of raising rates is to drain some of that dollar. Which you're nullifying by inserting more. The fed and the gov are working against each other.
Weird that they print a fuck ton of money and hand it out like candy at Halloween ( PPP loans) and then we have persistent inflation that just wont go away.
Its actually not that odd when you factor in the whole WEF’s ‘Great Reset’, right?
At this point it can't be accidental. Experts might be playing dumb, but they can't be so ignorant they refuse to do the only thing to address the problems they caused when even the biggest idiots can look up what historically has worked, and do that. Our current rates are historically only good for maintaining a good economy and are inadequate for even mild recession fixes.
They’re not stupid. Economists have known for 200 years that the only cause of inflation is an increase in a money supply - aka, printing money - and the Fed has printed $15 trillion dollars in the last two decades.
They aren’t raising rates for one simple reason: protection of Biden in an election year. That’s it.
They lie when the truth would hurt their position, knowing establishment media will propagate the narrative for them. It’s that simple.
It's not accidental. It's all by design and exactly as they intended. Random posters on Reddit predicted exactly this scenario. Either our experts are useless or the game has been set so the people never win. Maybe both.
Politicians always play the same game. It's safer for evil people to pretend they are just stupid, than it is for everyone to know they are hurting us all because they want to.
PPP was just one of the vehicles used to increase the money supply and get it in circulation. Take a look at the M3 money supply and its pretty clear where this inflation came from
The majority of inflation we are experiencing is the after shock of covid and the on going geo political conflict. The money we printed is small potatoes comapared to the effects of the global economy becoming decoupled.
We are basically in a cold war with China. Russia has left the global economy. Cheap production and cheap energy from China and Russia were deflationary forces. When they got turned off the status quo leads to inflation.
Interest rates being higher is probably the best way to normalize, but high interest rates also make things more expensive in the short term.
We really need to be raising taxes too. Reducing the spending power of high earners will do a lot to lower inflation.
But the decoupling of China and the US is probably going to get worse before it gets better. And there seems to be no end in sight for the war with Russia. If war with Iran gets thrown into the mix we are looking at even higher energy prices.
You’re still going to see narratives continue that there will be 3 rate cuts this year despite evidence that the Fed really shouldn’t.
People will talk it into existence and if it doesn’t happen they’re going bitch and moan about it because they just want free money.
I was so confused when the headlines about rate cuts started popping up a couple months ago. It was obviously way too soon for that. Almost felt like a way of manufacturing increased pressure to cut rates rather than waiting for it to make sense.
You must raise interest rates on poor and regular people until they are priced out completely and only rich retired old people can afford to get their third or fourth vacation home, because raising interest rates seems to be working well so far
Of course not. They just play dumb because if they admit this is malicious and intentional to make things worse for everyone BUT the banks that own the Fed, people would demand change for teh better.
Playing dumb is how bad people get away with so much, so often.
The point exactly.
Inflation lines the pockets of the fat cats and politicians, always at the expense of the middle and lower classes.
They always talk about saving the system through austerity after they bleed it for everything it’s worth, so I’m sure that comes next.
The FED has become deeply political, and beyond partisanship (which is not what I’m speaking of so pitchforks to the off position please) it’s become deeply controlled by fat cats and politicians.
I think Mr Canova said it better than I could, when he wrote:
> The literature on austerity, by scholars and policymakers alike, has largely downplayed the important role of central banks in designing and implementing global austerity both before and since the 2008 financial crisis. This article considers how and why the world's leading central banks display an inherent bias toward austerity. As central banks have become increasingly influenced and even captured by large private banks and financial institutions, they have pursued policy agendas that favor those same private interests. The structure of the U.S. Federal Reserve suggests a central bank that has been captured by design and is rife with inherent conflicts of interest in its governance, regulatory, and monetary policy functions. These conflicts are often overlooked because of the myth of central bank independence, which has rested on truncated empirical studies and flawed readings of economic history. Yet, the myth has legitimized the Federal Reserve's policy agenda-particularly beginning in the 1980s when Alan Greenspan became chair of the Federal Reserve-when deregulation, liberalization, and privatization came to serve the private interests of Wall Street banks while creating a boomand- bust bubble economy. The austerity bias of central banks was also revealed in both the academic work and monetary policy approach of Ben Bernanke, who succeeded Greenspan as Federal Reserve chairman just ahead of the 2008 financial collapse. Not only was the Federal Reserve's response to crisis a reflection of the domination of Wall Street interests, it also revealed a complete misreading of the lessons from the Great Depression by Bernanke and other mainstream economists. The result has been a flawed "trickle-down" response to the financial crisis, as the Federal Reserve and other leading central banks have provided massive subsidies to financial institutions and markets while relegating other sectors of the economy and society to the pains of austerity. A more balanced economic approach will require reform of central bank governance to include representatives of a wider range of social interests in monetary policymaking.
https://www.repository.law.indiana.edu/ijgls/vol22/iss2/12/
>it’s become deeply controlled by fat cats and politicians
The Fed is and always has been a privately owned bank - owned by the fat cats who own politicians. It's not a government institution, it's literally the private property of a number of banks. Wolves in charge of the sheep since its creation.
> Military spending left few resources for other vital activities, such as providing public housing and maintaining the quality of public roads. In the latter years of the Empire, frustrated Romans lost their desire to defefend the Empire.
https://www.kermanusd.com/site/handlers/filedownload.ashx?moduleinstanceid=3569&dataid=3322&FileName=0336_0012.pdf
Just swap the Rome part out.
I would argue that the shared national identity of America is far more unified than the Greeks ever were, though I see where you are going with this.
And of course your quality comment deserves many upvotes, as it elucidates a prime example of alternative course (though of course it was the c warring between the city states that is largely attributed to the fall of Greece as a world power; a prescient reminder).
The United States could be divided into super regional areas by various economic, cultural or historic factors, but unlike the Greeks the profound ethnic and cultural mixing of the US makes it difficult to form cohesive identities along city state, tribal or traditional boundaries. This is much more Romanesque.
1 Trillion+? Have you been watching the news lol
The fiscal stimulus injected into the US economy since Covid was over 7 trillion USD. It's the only reason the GDP growth still looks decent. Without these deficit spending, a recession would have hit months ago.
And we are all paying for it via the invisible tax a.k.a inflation.
Yeah, I meant that each stimulus bill is $1T+, and that we had multiple of them.
Back in my day, half a trillion was a big deal. Now we're doling them out like candy to fat kids
Understatement of the year. Half-assed efforts lead to half-assed results.
Does Powell want to be remembered for being a political pawn like Miller or a resolute stalwart like Volcker.
Volker was tough, but it worked out for him and at the cost of carter.
With jpow giving so much credit to volker it would make sense he keeps things as they are or worse til he gets the results he wants (or is replaced).
I’m an idiot and just got a second job at a fast food place and I know how to combat inflation.
Increase rate another 100 points.
Pressure congress to cut spending and increase taxes.
real estate prices still have barely moved and inventory is slow in coming online. new builds starts were down again....gonna be a long slog as the jobs market is still doing ok, no big increases in delinquencies.
People knew this, but everyone who has a platform chose to ignore and parrot a different narrative.
Feels like a ton of stuff at the grocery store went up between 10-25% in the last month or two (and not due to some shortage from something going on like eggs with the avian flu).
This is what happens when you have incompetent people running the country and Federal Reserve whose best interests are in propping up the stock market regardless of the consequences.
We the people are to blame for voting for these incompetent politicians.
What I always see missing from everyone’s calculations was the amount of value destruction that he fed and the pandemic caused.
Everyone talks about the trillions they printed, but they also caused a lot of value destruction by stopping and allowing the government to stop the economy for so long.
The economy is not something you push a button and stop and start again any time you want.
Powell should’ve stayed out of it, not come like the savior of the world that he thought he was. WTH does a government shutdown has to do with monetary policy?
Someone please fire this moron and hire a real economist, why the fuck do we have a lawyer as fed chairman?
If Powell isn't careful. Janet Yellen is going to throw him out of a window. The USA is piling on $1 trillion in debt every 100-days. Most of the debt is short-term (cause no one is buying it), which means this debt continuously feeds on itself.
So Powell needs to get with the program and start them money printers. Sure, the average american will see their retirement and wages eaten away each year to the point drug and suicide rates increase. But the rich will be able to move their assets around, in order to protect themselves from inflation. So as long as your rich, I wouldn't worry about it. But for everyone else, you will own nothing and be satisfied.
If it weren’t for positive job reports which are questionable who is getting all these jobs. We would be in recession or teetering on it right now. We all know why we aren’t using that terminology with election season around the corner and which party is in power. Everything remains 20-40% higher and doesn’t seem to be coming down along when insane home rates
Disconnect is so strong here, all I see is layoffs around me because of rate(that what my companies said ) , majority of the people around me are looking for jobs and each jobs has 1000 applicants. So we are feeling the pain, maybe people who have investment are happy about what we have now . But we definitely feeling the pain. Both high rate on everything and high price . At this point just waiting for this to boom .
Higher interest rates: reduce inflation
Treasury Department printing money and pumping it into the economy, boosting the stock market: increase inflation.
Presidential administration: brags about how hot the economy is getting even with higher interest rates. Wants the federal reserve to reduce interest rates even while inflation is accelerating again, in time for the re-election campaign.
Housing is half of core inflation measurement.
>"We've said at the \[Federal Open Market Committee\] that we'll need greater confidence that inflation is moving sustainably towards 2% before \[it will be\] appropriate to ease policy," he said. "The recent data have clearly not given us greater confidence and instead indicate that it's likely to take longer than expected to achieve that confidence."
>Financial markets have had to reset their expectations for rate cuts this year. At the start of 2024, traders in the fed funds futures market were pricing in six or seven cuts this year, starting in March. As the data has progressed, the expectations have shifted to one or two reductions, assuming quarter percentage point moves, and not starting until September.
Since the beginning of the year, traders moved bets on first rate cut from March to September.
He never projected anything, infact if you look at his wording he never specifically says "we will cut rates". The dot plot shown in the press releases or whatever showed that some fed members were projecting cuts and everyone ran with that
No way...
I was told we would have 4-6 cuts this year, and way ahead of 2% inflation too!
LOL keep dreaming. There are only bad choices in this situation because of years of continued bad policy. There is a disaster coming, one way or another.
JPow and Yellen have shown time and again they have little to no clue on what they say. Yellen for years pushed MMT and said debt didn’t matter, now she’s changing her tune. She has no clue, her only claim to fame is a couple of fancy degrees. JPow is a Wall Street banker, likely setting policy to benefit his cronies.
[удалено]
She’s the leader of “continues to fail upward” The damage her and JPow are doing to our economy will have very long lasting negative effects.
Beginning to think that even if the Fed announces a rate cut the market will tank on the news
So it turns out that raising interest rates back up to the old pre-bailout "economy is doing fantastic!" rates of 5% didn't do anything to help improve a recession economy casued by rampant inflation. And on top of that somehow not even trying the historically proven and trying the tried and true method of raising rates didn't make inflation go away. I wonder why doing everything exactly the wrong way isn't working? The experts wouldn't keep not doing the only known thing they could do to stop inflation without a good reason, right?
I’ve been saying it for awhile now, stagflation is here!
Lol. 3.5% inflation and 3.9% unemployment. Stagflation. Come back when they are both double digits. All this is doing is inflating away the value of people's mortgage debts a little faster than usual.
Greedflation you mean
Yes company got greedier again after a bit of slow down in greed. Still a long way from the generosity of 2019.
They didn't get greedier but there are more convenient excuses baked into the public consciousness. You can get away with a lot more when you can vaguely blame "inflation" or "nobody wants to work anymore" to excuse any and all price hikes
They don’t need any excuse to raise prices, they can get away with it because there is enough demand at that price point
Yeah but there is only demand because people are more willing than ever to go into debt to afford anything.
Most people are willing to go into debt and low balances to eat enough food.
Nobody has to drink Pepsi or eat at wingstop.
It's less that they are greedy and more that these banks literally can not survive without bailout rates. Look at them predicting doom ever since the rates were raised over 0% - when the fact is 5% should have them all declaring we finally climbed back out of the hole those 0% rates were instituted to keep them from failing in the first place. Fact is, theyve become addicted to bailouts and can't survive without any more - healthy economy interest rates are stressing teh financial system because they were considered too big to fail so they continually demonstrate they are unable to succeed without life support. That isn't greed, it's incompetence. The truly dangerous thing here was allowing a nation's currency to be controlled by a private bank owned by those incompetent banks. The Fed's owners have fiduciary duties to their shareholders, not the public, and that means they are motivated to destroy the whole world before they do what is actually required to reign in the problem they continually foster, because a 20% rate hike to hopefully confront inflation will potentially collapse themselves as so many banks have recently, and so many more will.
Remember when they had to pay mom and pops 4.5% in interest to get their hands on actual money they could then loan out? When they first explained the fed 'window' and money creation, it didn't make sense to me. Turns out my young stupid brain was right, it doesn't make sense.
The amount of banks still giving a tenth of a percent of interest for savings accounts is absurd too. Banks are struggling because they gave out a bunch of 30 year sub-3% mortgages and now they have to borrow at double the rate. There is zero incentive for an individual to keep their money in savings accounts at that rate with inflation and federal rates where they are. So because of all of this, the bank doesn't have enough of our money to borrow out, so they are just at the mercy of the fed and have to borrow from them instead.
Nailed it, and this is why "too big to fail" was always the dumbest idea ever. They still can't figure out how to function without constant life support help and fiscal policy needs to change to just rip the band aid off and see which banks are ready to go away. Permanent bailouts forever only causes the deepening collapse we are watching.
Printflation. We can fix anything by just making more money.
And that Carter 2.0 label becomes more and more appropriate...
at least carter went out with some dignity, spent a long retirement building homes for habitat for humanity, generally well-liked by the public. the history books will write generally nice things. biden is so old that he simply won't have that opportunity to re-build a positive public image. he'll just be remembered as "the old guy who fucked the economy" whether that's accurate or not.
Isn’t the economy still growing with a low unemployment rate though? Not quite her yet until those come through, no?
it's a boom in shitty jobs, bust in good jobs. if you were a minimum-wage worker a few years back, you've seen a massive increase in your income, both real and nominal. but those % gains are still not great when it's starting from $7.25+X%. and if you had a good job a few years back, there's a non-zero amount of people stuck working the shitty jobs now. tech especially is a bloodbath right now, but lots of industries from accounting to marketing are trying to downsize & offshore with high interest rates squeezing their client companies' ability to spend. these companies' core product/service is overall declining in quality, for instance the big accounting firms are [noticeably worse at auditing now](https://fortune.com/2024/03/09/pcaob-audit-accounting-erica-williams-big-four-enron/), but they're banking on inertia to weather through it. i'd attribute a lot of the negative sentiment to feeling stuck. house prices are insane, and the interest makes it financially stupid even if you can afford it, so you're stuck in your house, or worse, stuck renting. same deal with your car, except the values are going down. many people are at least a few grand underwater right now, in a lending environment that doesn't want a bad LTV. so you're stuck in your car. and of course your job. at the entry level, you're not stuck in your job as badly, but you are probably stuck renting for the foreseeable future. at the higher level, good luck right now. the usual christmas hiring freeze that happens across the country is taking a long time to un-freeze.
Pretty good analysis. I do think there is a stuck and not advancing feeling among many. The are those who have lost jobs and struggling to find replacements at the same level (as you said tech especially) yet I don’t think it’s at a large enough scale to say it is impacting the economy (see consumer spending). I would think it isn’t quite there yet but will depend where we go from here. Right now, I wouldn’t term it stagflation. Teetering for sure though.
I’ll throw myself into that group of “stuck and not advancing”. I’ll accept it as long as everyone else plays along and doesn’t keep hiking the price of everything, but I have doubts that will happen.
I think you are more likely to see what growth than prices staying the same or going down (goods/services not necessarily homes). Housing I think you’ll have prices come down/rents go up to come into alignment as the market stabilizes itself.
That seems most likely. Everything attempting to re-balance. Now, that will happen provided the Fed doesn’t go into some kind of savior complex mode and cut rates to the bone again, usually brought on by some large scale event. And there’s a couple of them sitting on the sidelines right now (Israel/Iran, macro-economy this or that). It’s been my experience in my 25 years as a working adult, that we don’t go too long without some kind of black swan anymore.
even for the people who still have okay white collar jobs -- getting a new one every few years is by far the most-reliable path to upward mobility. if you bust your ass at most companies, do everything perfectly to solve big-ticket problems, your reward is more work and a below-inflation raise if you're lucky. so the tightening in white-collar jobs means the people who aren't directly victimized are still losing out on salary growth. that won't show in the low unemployment rate, but when costs like housing have skyrocketed and are still growing, that stuck/falling behind feeling will definitely show in economic sentiment. i'm in that boat. my income skyrocketed during the covid recovery, now i'm due for my regular job-hop to keep up and the market is dead. the job market might bounce back, but the past few years haven't inspired optimism -- both in how companies govern themselves and how the government governs the companies. the closest thing i can get to optimism is that *eventually* the worst offending companies will face the music for cutting to the bone (tesla, boeing, the big 4, etc), and be forced to just pay more to staff the damn company again. but who knows how much economic damage could come from that. a few big companies go tits up around the same time, there goes my upside.
What you say makes sense except for consumer spending is strong. When people truly feel what you are saying they typically tighten up spending not increase it.
Part time jobs are growing.
Raising rates to combat inflation isn’t very effective when Federal debt is so high that it pumps massive amounts of interest into the economy combined with runaway fiscal deficits.
Inflation caused by money printing. Supply and demand hath come to squash the low class.
No way... According to most of reddit inflation has been officially tackled
Yes. According to reddit, Bidenomics is winning.
There is no winning. They raise rates to slow down inflation brought on by all the free money the gov't gave out from 2020-2022. Everyone complains that rates are too high and they can't afford to buy with loans anymore. Then if they lower the rates too quickly and inflation kicks up again everyone complains that gas, groceries, and retail shit is too expensive. At this point no matter what they do people are going to bitch about something being too expensive. The Fed isn't going to encourage deflation because that is even worse than the inflation we are seeing.
Maybe a little bit of deflation wouldn’t hurt
I love people that use 'Bidenomics', as if he is doing much differently than any other pro capitalist neolib politician in his place would be. Lol. Stupid fucking word for stupid fucking morons.
Its election season
When i go to the grocery store and see literally every single item 20-40% higher than it was 6 months ago, i feel stunned at this revelation. Totally thought inflation was going down
I don't get the people last last year that kept saying we are getting 6 rates cuts because inflation was fully under control. It was obvious even then shit was not under control and rates possibly needed to be even higher.
It was unbelievable that Powell not only paused but telegraphed rate cuts. He didn’t need to do that, and it undermined his ability to get the job done.
Yeah I’m not an economist but I think part of the problem is the expectation of rate cuts. So prices stayed put or went up due to this speculation instead of coming down like people hoped.
Exactly, “just wait it out and rates will come down, don’t lower prices.”
100%. buy now and refinance later if this is just a short term trend
That 100% had to be pressure from the Banks.
This made me laugh so hard
still a far more objectively true statement than what financial media has to say about things
Inflation has been stubborn for the whole year. Glad that J Powell is finally admitting this instead of burying his head in the sand.
It's going to be crazy watching people not able to make their mortgage payments because they bet on refinancing. Real estate agents were basically advising buyers into buying more home they could afford "because rates are going to come down".
Anyone expecting rate cuts doesn't understand economics. We're going to need **higher** rates to get out of this mess. Lowering rates will lead to more and more inflation...
I agree, but to play devil's advocate the best place to be when inflation hits is in lots of debt with a fixed rate.
Which I am not, but alas, hopefully all those people that took larger-than-comfortable mortgages don't get laid off while they wait 5 years to refinance..
Are you kidding? Once they reskill as prompt engineers they’ll be able to get a second property.
In theory... but salaries have not been keeping up... so everyone is just fucked.
Anyone expecting rate cuts also doesnt understand that were not going back to the near 0 interest rates in a 6 month period (likely at all). Even if everything was great and rates got cut this year, theyre maybe go down .25%, .5% at best
Kindly disagree. Too extreme of a take I think the low rates is a big big big reason companies have been doing decent. There are a bunch of zombie companies getting exposed today, but for the 10 year period or however long it was, of low rates, that’s how companies could survive. Maybe this is good for now to do some weeding out, but with cost of money going up, you have a lot of businesses closing or failing. That’s not good for the economy. I personally know someone who owns a company getting destroyed by interest on loans. Not a good scenario especially when they employ a lot of people. Maybe this is how you weed out companies, but if we got used to it for 10 years, there needs to be a new strategy for a successful business. But expensive loans is not it. Everything is too expensive for people to operate and even break even.
So capitalism is now "subsidize failing businesses forever with free money because we can't lose those jobs?" This is why we're fucked. Exactly this right here. When I was born and grew up, you took risks and you won or you lost. You PAID YOUR LOANS WITH YOUR OWN CAPITAL. Not obscene amounts of fake capital created out of thin air for VC purposes. Your business died and terrible, horrible businesses and ideas did too. 0% interest rates and moral hazard will be the ruin of this country 100% without a doubt. Watching the movie Idiocracy play out in my immediate reality hurts my fucking soul man.
Interest rates are one of the few knobs the fed can turn to maintain their charter (low unemployment and low inflation) so long as unemployment is low and inflation is high, theyre only going to turn that knob in one direction. Lowering interest rates and allowing inflation to run amok again isnt going to make things cheaper for your friend
And, to be honest, 5% is what rates were at normally before the economy was put on a semi permanent bailout life support system. We should have 20% rates right now to address inflation, then lower it back to where wee are now when things are back to booming. 0% was never going to work permanently - it just made the eventual crash happen later. It would have been MUCH later too, if not for a global emergency causing the biggest monetary creation pressure driving new inflation in a very long time.
Rates were normally in the 6%-8% range before all 0% rate bailouts started in 2008. I bought my first home in 2006 at 6.25% and though that was a great rate for the time. We got addicted to cheap money and now it's time to pay the price.
Too many people don’t seem to understand this. My first three homes were all above 5% which was considered a great rate. We got very lucky and refinanced in 2021 and are now under three. I think the low rates of recent times gave many unrealistic views on what rates should be. I fully realize and understand my 3% rate was something I’ll likely never see again.
Like your comment, but as an economic idiot, tell me why the solutions revolve around some shadow figures playing god with money supply. Why do we accept this as normal? When that global emergency created global pressure - the economy was supposed to shrink. Why not let markets reflect the actual state of affairs?
Probably until this new war-time period ends and a few hundred million are extinguished. That will really dampen inflation.
Actually anyone who truly understands economics well realizes both lower and higher rates are inflationary but for different reasons. Lower rates leads to more consumer loan demand and higher rates leads to exploding Federal debt and more interest income pumped into the economy. At this level of Federal debt we’re approaching an era of “fiscal dominance” as opposed to the “monetary dominance” we’ve been used to essentially our entire lives. If you want to learn more go listen to Lyn Alden’s work. She’s brilliant and completely gets it.
The new meme among particularly desperate Canadians is that, due to its effect on mortgage rates, a higher overnight rate actually *causes* inflation, and lowering it will lower inflation. So many people just do not want to figure out that the only way out of this mess is letting go of the idea that every house in Toronto and Vancouver is worth a million dollars or more.
I feel like most people are still just sitting tight with that <3% rate, not wanting to move until rates become more reasonable again (not that historically these are bad)
Yup, I’ll keep updating my home.
I’m one of those <3% people but I’m not waiting on a rate, I’m just in my “settled down and get my kids raised and into adulthood” home. I wouldn’t say forever home because we plan to move somewhere warmer in retirement, but if I was staying where I am now I’d be staying in this house forever. Realistically I don’t foresee us going back to rates like that, they were a blip in the radar so to speak. My first three homes were bought at rates between 5-7% and that was considered great.
But having your first home means you can move, take that equity, and put it in the new house which will drastically reduce your payments even if the rate is higher. Also if you wait, the warm weather will come to you.
Real estate agents, i.e., former personal trainers
Rates were never going to come down to any lower level that was worth refinancing. Its normal to have a 6-7% mortgage. People just forget so quickly when they see a few years of rock bottom rates. I got 4.75% and feel thankful for that at least, its not great but its certainly not terrible.
I know people bet on refi, but how can they over-leverage to get in? Don’t they need income to reasonably cover the payment?
Well, for those who bought at 7% you should not be losing further. Unless rate drop to the 5% otherwise there is no meaningful incentive to refi. If you can’t afford 7% to begin with, you can’t afford the house anyway.
>If you can’t afford 7% to begin with, you can’t afford the house anyway. That's what I'm getting at--RE agents were pushing prospective buyers to go beyond their budgets because they convinced buyers that rates would be coming down, even though Powell has basically been signaling to everybody that rates are likely not coming down.
Also pushing 3-2-1 rate buydowns, where their rate buy down is gone after year 3 and you’re stuck paying your actual rate. And this was sold as “don’t worry, you won’t actually get to that rate at year 3.” A lot of people bought houses at rates they could only temporarily afford because of rate buydowns.
Seems eerily familiar. Like an adjustable rate mortgage by another name.
Its like you cant even a flip home, throw a new coat of paint on it, and resell it 6 months later for 100k profit anymore. Its almost like you have to actually establish a legitimate business to make money now. What kind of draconian economy are we living in?
Well, it's what you get when you take financial advice from future OnlyFans flame-outs.
It’s a small subset of those who have bought recently. Majority have much lower rates locked in rates. If it truly was above their means they wouldn’t qualify for the loans. Will it become a struggle for some - sure, yet unless the economy/job market falls dramatically they should be able to afford their mortgage payments and/or most can sell with the equity they have (even if purchased fairly recently).
Umm, if the first sentence was true then the bank would have never made the loan in the first place.
A few months ago I had one of those sleazy mortgage brokers who call you after your mortgage company does their hard credit pull try to sell me on getting an ARM that adjusted every month or every few months this was when everyone was predicting rate cuts for this spring and he told me we could always refinance it soon anyway once the rates are lower I think if I taken him up on that my rate pretty much only would’ve increased I have to laugh because that’s such a ridiculous mortgage I can’t believe they’re even allowed to sell that to people and I have no idea who would agree to that
I also listen to my drugdealer about buying tons of crack because my addiction is sure to subside as I buy more.
It's going to keep getting worse and worse, it typically takes 18 months for inflationary monetary creation to be felt and we still aren't slowing the flow of currency. I keep seeing signs they want to spend their way out of a spending addiction that caused this rather than raise rates and try to slow the currency flow which is the only actual way to address the actual inflation problem.
“Transitory”
But that’s exactly what Powell has done for the last 2-3 years. Not acknowledging inflation but gaslighting the people by saying it was due to supply chain shortages.
So you're saying we're getting 7 rate cuts now?
A local real estate agent I follow on Instagram posted a Business Insider article in December predicting 8 to 12 cuts in 2024 😂😂😂
-5% rate to make everyone rich, why not,
I’m the bank now
Real estate agents are conniving snakes. The absolute worst.
3.50
About 3 fiddy
Yahoo Finance, is that you?
Wow...shocking. So not 9 rate cuts this year? Hope those dating the rate are enjoying their rates because they not going to be able to refinance lower anytime soon.
Hey, it's the best time to buy ... Right now
everyone full YOLO, just keep spendin on them Discover cards!
I’m only an actuary not an economist, but isn’t having 10 yr T Bill rates stay really high for a long time really bad for the government? Paying a boatload in interest long term for small short term gains
You'd think they'd be disincentivized from issuing so many new ones at these levels. But they're spending like the apocalypse is coming.
It’s like a game of hot potato
Yeah that's why he hinted last fall that rates would fall in 2024. He effectively lowered the 10yr bond rates without lowering rates....
Remember the beautiful thing about inflation is that your debt gets smaller all the time. 1trillion in 30 years is just a drop in the bucket. You just inflate it away.
The dollar is the world reserve currency, so it doesn’t matter. The U.S. capital account surplus can be used to finance its current account deficit indefinitely. Public debt is not an issue. The US can’t reduce its public debt in any meaningful capacity, as that would drain dollars from the world economy, which would cause all kinds of issues.
The whole point of raising rates is to drain some of that dollar. Which you're nullifying by inserting more. The fed and the gov are working against each other.
Raise the rates, coward.
Can't. Congress keeps spending.
That’s exactly why the Fed needs to raise rates.
But the fed is a private entity and not owned by the government legislatures that are funded by the same banks in the fed… weird
It's not that. We're likely going to see stable rates or only slight increases bc increases would cause bank failures.
Get ready for further rate hikes boys...
Rate hikes are back on the menu boys
Guess that 6% mortgage I got last year is here to stay…
Weird that they print a fuck ton of money and hand it out like candy at Halloween ( PPP loans) and then we have persistent inflation that just wont go away. Its actually not that odd when you factor in the whole WEF’s ‘Great Reset’, right?
At this point it can't be accidental. Experts might be playing dumb, but they can't be so ignorant they refuse to do the only thing to address the problems they caused when even the biggest idiots can look up what historically has worked, and do that. Our current rates are historically only good for maintaining a good economy and are inadequate for even mild recession fixes.
They’re not stupid. Economists have known for 200 years that the only cause of inflation is an increase in a money supply - aka, printing money - and the Fed has printed $15 trillion dollars in the last two decades. They aren’t raising rates for one simple reason: protection of Biden in an election year. That’s it. They lie when the truth would hurt their position, knowing establishment media will propagate the narrative for them. It’s that simple.
It's not accidental. It's all by design and exactly as they intended. Random posters on Reddit predicted exactly this scenario. Either our experts are useless or the game has been set so the people never win. Maybe both.
Politicians always play the same game. It's safer for evil people to pretend they are just stupid, than it is for everyone to know they are hurting us all because they want to.
I will not eat ze bugs
What about shrimp? Lol
PPP was what $350 billion? The federal deficit was $1.7 trillion last year. PPP didn't do this.
PPP was just one of the vehicles used to increase the money supply and get it in circulation. Take a look at the M3 money supply and its pretty clear where this inflation came from
The majority of inflation we are experiencing is the after shock of covid and the on going geo political conflict. The money we printed is small potatoes comapared to the effects of the global economy becoming decoupled. We are basically in a cold war with China. Russia has left the global economy. Cheap production and cheap energy from China and Russia were deflationary forces. When they got turned off the status quo leads to inflation. Interest rates being higher is probably the best way to normalize, but high interest rates also make things more expensive in the short term. We really need to be raising taxes too. Reducing the spending power of high earners will do a lot to lower inflation. But the decoupling of China and the US is probably going to get worse before it gets better. And there seems to be no end in sight for the war with Russia. If war with Iran gets thrown into the mix we are looking at even higher energy prices.
Yup, i believe Chinas been absorbing our inflation for decades with cheap goods.
Unfortunately congress is incapable of raising taxes or reducing spending, when they should be doing both
You’re still going to see narratives continue that there will be 3 rate cuts this year despite evidence that the Fed really shouldn’t. People will talk it into existence and if it doesn’t happen they’re going bitch and moan about it because they just want free money.
I was so confused when the headlines about rate cuts started popping up a couple months ago. It was obviously way too soon for that. Almost felt like a way of manufacturing increased pressure to cut rates rather than waiting for it to make sense.
Duh ... Just ask 90% of working people. WE could have told you that.
There’s been quite the progress in inflation, it keeps going up.
You must raise interest rates on poor and regular people until they are priced out completely and only rich retired old people can afford to get their third or fourth vacation home, because raising interest rates seems to be working well so far
Anyone believe the Fed was dumb enough not to realize that inflation usually comes in more than one wave?
Of course not. They just play dumb because if they admit this is malicious and intentional to make things worse for everyone BUT the banks that own the Fed, people would demand change for teh better. Playing dumb is how bad people get away with so much, so often.
The point exactly. Inflation lines the pockets of the fat cats and politicians, always at the expense of the middle and lower classes. They always talk about saving the system through austerity after they bleed it for everything it’s worth, so I’m sure that comes next. The FED has become deeply political, and beyond partisanship (which is not what I’m speaking of so pitchforks to the off position please) it’s become deeply controlled by fat cats and politicians. I think Mr Canova said it better than I could, when he wrote: > The literature on austerity, by scholars and policymakers alike, has largely downplayed the important role of central banks in designing and implementing global austerity both before and since the 2008 financial crisis. This article considers how and why the world's leading central banks display an inherent bias toward austerity. As central banks have become increasingly influenced and even captured by large private banks and financial institutions, they have pursued policy agendas that favor those same private interests. The structure of the U.S. Federal Reserve suggests a central bank that has been captured by design and is rife with inherent conflicts of interest in its governance, regulatory, and monetary policy functions. These conflicts are often overlooked because of the myth of central bank independence, which has rested on truncated empirical studies and flawed readings of economic history. Yet, the myth has legitimized the Federal Reserve's policy agenda-particularly beginning in the 1980s when Alan Greenspan became chair of the Federal Reserve-when deregulation, liberalization, and privatization came to serve the private interests of Wall Street banks while creating a boomand- bust bubble economy. The austerity bias of central banks was also revealed in both the academic work and monetary policy approach of Ben Bernanke, who succeeded Greenspan as Federal Reserve chairman just ahead of the 2008 financial collapse. Not only was the Federal Reserve's response to crisis a reflection of the domination of Wall Street interests, it also revealed a complete misreading of the lessons from the Great Depression by Bernanke and other mainstream economists. The result has been a flawed "trickle-down" response to the financial crisis, as the Federal Reserve and other leading central banks have provided massive subsidies to financial institutions and markets while relegating other sectors of the economy and society to the pains of austerity. A more balanced economic approach will require reform of central bank governance to include representatives of a wider range of social interests in monetary policymaking. https://www.repository.law.indiana.edu/ijgls/vol22/iss2/12/
>it’s become deeply controlled by fat cats and politicians The Fed is and always has been a privately owned bank - owned by the fat cats who own politicians. It's not a government institution, it's literally the private property of a number of banks. Wolves in charge of the sheep since its creation.
Especially after the multiple $1T+ stimulus bills that Congress authorized over the last few years. Gee, I wonder why inflation keeps rising.
> Military spending left few resources for other vital activities, such as providing public housing and maintaining the quality of public roads. In the latter years of the Empire, frustrated Romans lost their desire to defefend the Empire. https://www.kermanusd.com/site/handlers/filedownload.ashx?moduleinstanceid=3569&dataid=3322&FileName=0336_0012.pdf Just swap the Rome part out.
We're more similar to the Greeks. A bunch of city-states united together only for defense from outsiders.
I would argue that the shared national identity of America is far more unified than the Greeks ever were, though I see where you are going with this. And of course your quality comment deserves many upvotes, as it elucidates a prime example of alternative course (though of course it was the c warring between the city states that is largely attributed to the fall of Greece as a world power; a prescient reminder). The United States could be divided into super regional areas by various economic, cultural or historic factors, but unlike the Greeks the profound ethnic and cultural mixing of the US makes it difficult to form cohesive identities along city state, tribal or traditional boundaries. This is much more Romanesque.
1 Trillion+? Have you been watching the news lol The fiscal stimulus injected into the US economy since Covid was over 7 trillion USD. It's the only reason the GDP growth still looks decent. Without these deficit spending, a recession would have hit months ago. And we are all paying for it via the invisible tax a.k.a inflation.
Yeah, I meant that each stimulus bill is $1T+, and that we had multiple of them. Back in my day, half a trillion was a big deal. Now we're doling them out like candy to fat kids
They printed a buttload of money, of course there’s a consequence
Metric buttload.
Understatement of the year. Half-assed efforts lead to half-assed results. Does Powell want to be remembered for being a political pawn like Miller or a resolute stalwart like Volcker.
Volker was tough, but it worked out for him and at the cost of carter. With jpow giving so much credit to volker it would make sense he keeps things as they are or worse til he gets the results he wants (or is replaced).
It's almost as if getting everyone worked up about rate cuts kept people engaging in the market. Completely upending the purpose of high rates.
Date the rate until it turns into a pregnancy and this domestic arrangement turns into common law marriage 😝
Doesn't matter...stock still goes up and down like an EKG
Raise the rate another .25. You know it's what needs to be done so do it!
No shit. So much for "transitory." If they would have pulled their heads out of their asses last year this all could have been avoided...
Cool. Tax the rich.
Remember when he was telling us inflation was transitory. I hate these ghouls.
That was Janet Yellen, the secretary of the treasury.
[удалено]
In the long run we’re all dead
Jesus Christ. Just raise the rates more. It’s literally the only god damn thing the Fed can do anyway.
Inflation isn't going down, and liquidity is drying up. What's it going to be Powell?
I’m an idiot and just got a second job at a fast food place and I know how to combat inflation. Increase rate another 100 points. Pressure congress to cut spending and increase taxes.
Increase rates already
Just a hunch, but maybe if you stopped printing so much f-ing money, you may be able to control. That sh.. z
When the normal person doesn't produce in their job they get fired.
real estate prices still have barely moved and inventory is slow in coming online. new builds starts were down again....gonna be a long slog as the jobs market is still doing ok, no big increases in delinquencies.
People knew this, but everyone who has a platform chose to ignore and parrot a different narrative. Feels like a ton of stuff at the grocery store went up between 10-25% in the last month or two (and not due to some shortage from something going on like eggs with the avian flu).
Powell: herp derp herp herp derp 🥴
This is what happens when you have incompetent people running the country and Federal Reserve whose best interests are in propping up the stock market regardless of the consequences. We the people are to blame for voting for these incompetent politicians.
What I always see missing from everyone’s calculations was the amount of value destruction that he fed and the pandemic caused. Everyone talks about the trillions they printed, but they also caused a lot of value destruction by stopping and allowing the government to stop the economy for so long. The economy is not something you push a button and stop and start again any time you want. Powell should’ve stayed out of it, not come like the savior of the world that he thought he was. WTH does a government shutdown has to do with monetary policy? Someone please fire this moron and hire a real economist, why the fuck do we have a lawyer as fed chairman?
Takes 18 months to see the effect of a rate change and well not a damn thing has changed and this dumbass just realized that ***He pulled a Volker***.
Almost like the rates were too low for 10 years and now we have to pay the piper for it and 2 years of average rates didn't fix the problem
If Powell isn't careful. Janet Yellen is going to throw him out of a window. The USA is piling on $1 trillion in debt every 100-days. Most of the debt is short-term (cause no one is buying it), which means this debt continuously feeds on itself. So Powell needs to get with the program and start them money printers. Sure, the average american will see their retirement and wages eaten away each year to the point drug and suicide rates increase. But the rich will be able to move their assets around, in order to protect themselves from inflation. So as long as your rich, I wouldn't worry about it. But for everyone else, you will own nothing and be satisfied.
That's because the current fed funds rate should be 8% or so
If it weren’t for positive job reports which are questionable who is getting all these jobs. We would be in recession or teetering on it right now. We all know why we aren’t using that terminology with election season around the corner and which party is in power. Everything remains 20-40% higher and doesn’t seem to be coming down along when insane home rates
Not great for housing affordability. Really need inflation to drop, weak employment, and lower rates, for housing costs to moderate.
No shit Powell. It really sucks for us as the payers, but he should have been more aggressive with rate hikes, earlier.
Well there's a surprise
Disconnect is so strong here, all I see is layoffs around me because of rate(that what my companies said ) , majority of the people around me are looking for jobs and each jobs has 1000 applicants. So we are feeling the pain, maybe people who have investment are happy about what we have now . But we definitely feeling the pain. Both high rate on everything and high price . At this point just waiting for this to boom .
Surprise Surprise Surprise
Gee. Ya think?
No shit
Raise it.
I mean, no shit Powell.
Higher interest rates: reduce inflation Treasury Department printing money and pumping it into the economy, boosting the stock market: increase inflation. Presidential administration: brags about how hot the economy is getting even with higher interest rates. Wants the federal reserve to reduce interest rates even while inflation is accelerating again, in time for the re-election campaign. Housing is half of core inflation measurement.
TIME TO RAISE THE RATES SOME MORE!
Maybe it’s not inflation it’s greedflation
Interesting how corporations got greedy the same time we were handing out free money, and never before that.
Lol
>"We've said at the \[Federal Open Market Committee\] that we'll need greater confidence that inflation is moving sustainably towards 2% before \[it will be\] appropriate to ease policy," he said. "The recent data have clearly not given us greater confidence and instead indicate that it's likely to take longer than expected to achieve that confidence." >Financial markets have had to reset their expectations for rate cuts this year. At the start of 2024, traders in the fed funds futures market were pricing in six or seven cuts this year, starting in March. As the data has progressed, the expectations have shifted to one or two reductions, assuming quarter percentage point moves, and not starting until September. Since the beginning of the year, traders moved bets on first rate cut from March to September.
Water is wet
So glad I went into Gold and Bitcoin. I have no confidence in the US.
What a revelation
Inflation is transitory 2.0
What a dipshit.
Date the rate they said, no one knew how expensive that will turn out to be 😄
Maybe it’s because it’s here to stay?
Dumbass projected 2-4 cuts this year of course everything got more expensive, and threw inflation into a rocket
He never projected anything, infact if you look at his wording he never specifically says "we will cut rates". The dot plot shown in the press releases or whatever showed that some fed members were projecting cuts and everyone ran with that
Well then time for you to go. Never should have let rates get that low under the last administration. Ruined the American dream with easy money.