Rate cut predicted as early as 1st quarter 2024? Really???

S

S2007S

This is really funny.. everyone in the last 2 weeks especially as of yesterday after cpi report that everything now is picture perfect and nothing but rainbows and butterflies....they are predicting rate cuts and a perfect soft landing. On top of that s&p predictions as high as 5400. So you are going to tell me the markets are going to go parabolic from now until whenever and the fed is going to come back in and cut rates all while unemployment is at historical lows and gdp only looking higher and higher as we proceed into 2024?
Why rate cuts? So we can keep the market juiced to infinity???


They believe its because of a recession, let's get one thing straight here. The fed will never ever ever ever ever ever never ever neverrrrrrr ever allow a recession to ever take place on the US economy!!!!

Remember that. They will never accept a recession ...so a Rate cut based on a recession is impossible.



https://www.businessinsider.com/sto...-recession-fed-interest-rate-cuts-ubs-2023-11
 
Ironbeam said:
Fed Fund futures are pricing a 26% chance of a rate cut in Q1 of 2024.
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One cpi report in the next few months 0.1% above consensus and that goes to 0 percent


There are no need for rate cuts. I was saying here years and years ago that rates should have never been at 0 percent and that they should have kept them at a simplen3 to 4% but they worried about stock markets returns and had to give wallstreet what they wanted so they gave them rates at 0% for too long which caused this situation of inflation to get out of hand.

Again with a strong gdp and perfect job numbers there is absolutely zero reason to take rates below 5%!!
 
S2007S said:
They believe its because of a recession, let's get one thing straight here. The fed will never ever ever ever ever ever never ever neverrrrrrr ever allow a recession to ever take place on the US economy!!!!

Remember that. They will never accept a recession ...so a Rate cut based on a recession is impossible.
More...

I think recession (or some new force majeure) is exactly the trigger they need to start lowering rates again.

ATM, rising markets don't do any good for a lower inflation. Lowering bond prices at the same time just fuels the investment returns across the board and thus inflation.
 
IMO China holds the key to rates. If they had come roaring back from Covid shutdown, crude and therefore gas pump prices would be much higher than they are currently, even with the current record amount of U.S. crude being produced (drill baby drill wink, wink Sarah).

If China gets going again producing and consuming, crude goes higher and with it CPI/PPI/PCE yada yada ... which will then push rates back up higher.

"That 70's show".

Actually I think we haven't seen the end of higher rates, even if China just muddles along.
 
I think the Fed is delusional if they think cutting the overnight rate, which is all they control, will have a significant impact on longer rates, or the economy. When has their timing ever been close to right? I've always maintained that the debt doesn't matter until it does, and then it's too late. Who is going to buy all those bonds we will need to sell to pay for levels of debt that are going parabolic?

Oh, btw, that chart is wrong. We owe just under $34 Trillion.
28393.jpeg
 
Arnie said:
I think the Fed is delusional if they think cutting the overnight rate, which is all they control, will have a significant impact on longer rates, or the economy. When has their timing ever been close to right?
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that's what open market operations is for, buying and selling short, mid and long term instruments to plot the yield curves.
 
When the Fed starts cutting rates the mkt is likely to tank significantly.

Rate cuts signals the economy is toast or the Fed broke something.
 
Last edited:
As I wrote in the fixed income thread, be ready for rate cut and position zt/zn/zb more or less. 275bps in total projected by the big guys are somewhat on the right track.
 
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