Rates unchanged!!

Tsing Tao said:
Several reasons. First, going to ZIRP was stated by the Fed to be "emergency policy". There is no further reason for "Emergency" policy 7 years after the fact.

Second, the Fed has indicated all year that "lift off" was coming. In order to maintain credibility (which is rapidly waning) this was the perfect time to do so.

Additionally, the Fed has stated, several times, that it does not base US policy on the "goings on" of the world and is not beholden to the stock market. Hiking now would have been a step in that direction. After all, it's a measly 25bps.



Thanks for your recommendation. I work in Finance and understand nominal vs. real quite well.

Fixed income is often referred to those who rely on savings and the returns of fixed investments. Not fixed income vs. variable or anything like that. I used the generic term you see when the subject is discussed, and you understood what I meant. Don't get all semantic on me, the point of the conversation is to converse and relay ideas between one another.

The senior on "fixed income" is a lot worse off. That's one of the reasons you see 55 and over going back to work, or not retiring, etc. Heck, a good deal of the employment gains in the past few years were the 55 and older crowd.
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Sorry for the fixed income diversion, you're right I know the common usage I just think it's entitled seniors misusing a term. I don't however, get why you think a senior is worse off today than say 10 years ago or 50 years ago if the real interest rates haven't changed appreciably?
 
This fed is a Fu$king joke.....I was listening to the 2:30 conference and laughed at all worthless dribble that came out of her mouth....as I said a million times the fed has no clue what they are doing....they bowed down once again to wallstreet... Now for the next 3 months we have to hear about the next meeting and what they are going to do which is absolutely nothing. The fed can't raise the rate one singe 1/4 of a percent... What does that tell you...that the economy is Fu$king worthless...
 
Tsing Tao said:
Inflation in food, housing, medical, etc. - the things we call "living index" are quite higher than the overall 1.5%-2.0% published rate in the last decade. Hedonics and inclusion of "other" items not critical to survival have significantly understated inflation. Additionally, the "real" income of folks isn't exactly doing wonders (unless you're lucky enough to live in the Fed's sprinkler system of free money).
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Seriously, "Hedonics"? Let's get intuitive here. The price of energy is down 70% from 2008, the price of mineral commodities down 40%. Oh, and you might have heard of that housing bubble bust, somebody's renting one of my houses for far less than the market rent in 2007, thats called deflation, not inflation. That gets priced into almost every necessity of life in a big way. There's no way that leads to high inflation. I'd love to see a detailed quantitative analysis by someone with a math or economics degree backing the hedonics out of core inflation and coming up with an appreciably higher number, have you done that or can you point to it? If not, again you want us to come around to your point of view simply because you say so, not very effective is it?
 
S2007S said:
This fed is a Fu$king joke.....I was listening to the 2:30 conference and laughed at all worthless dribble that came out of her mouth....as I said a million times the fed has no clue what they are doing....they bowed down once again to wallstreet... Now for the next 3 months we have to hear about the next meeting and what they are going to do which is absolutely nothing. The fed can't raise the rate one singe 1/4 of a percent... What does that tell you...that the economy is Fu$king worthless...
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Thank you for that well reasoned and insightful comment. You really educated us all.
 
ElCubano said:
Super Yawn...now we will have the same back and forth on financial news until their next meeting for the same result...
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Exactly.... With cnbc asking the same question over and over and over it gets really tiring... This market is one big laughing stock..the fed is one big laughing stock...
 
The fed said they aren't raising rates until the labor market improves???? Improves???? What has happened the last 6 years...is 5.1% unemployment rate not good enough...and then they said inflation is below their key level....really no inflation haaaaa. Rents..housing ...goods and services..tuitions. Food...hotels..meds. ..etc etc just skyrocketing..
 
Sig said:
So to be clear, we should do something that risks pushing us into a recession even though everything if going fine ("Unemployment is low, the dollar is strong, GDP is growing fast."), so that we will have a tool to help us out of the recession we caused unnecessarily?
BTW, its punishing savers when you have 10% inflation rates and 8% interest rates just as much as 0% interest and 2% inflation. That delta is little changed today from the average of the last 100 years.
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If a 1/4% rate hike is going to put the US into a recession then this market is overvalued by 75%...
 
Sig said:
Seriously, "Hedonics"? Let's get intuitive here. The price of energy is down 70% from 2008, the price of mineral commodities down 40%. Oh, and you might have heard of that housing bubble bust, somebody's renting one of my houses for far less than the market rent in 2007, thats called deflation, not inflation. That gets priced into almost every necessity of life in a big way. There's no way that leads to high inflation. I'd love to see a detailed quantitative analysis by someone with a math or economics degree backing the hedonics out of core inflation and coming up with an appreciably higher number, have you done that or can you point to it? If not, again you want us to come around to your point of view simply because you say so, not very effective is it?
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I don't want you to come around to my point of view at all. I certainly don't care if you prefer to think that hiking 25bps is dangerous to the economy after 7 years of ZIRP has done absolutely nothing for it. Typical Krumanite view - if spending money or printing money didn't work, it wasn't large enough.

You can think whatever you want, and we can all think it's humorous if we want. That way everyone is happy.

Comparing your rental unit now to what it took in at the height of the bubble is more what I'd call a statistic game than actual truth. Why not go back 10 years, overlay rent, food at home, medical with real wages? Bonus points if you exclude the top 1% from the wages calc.
See if everyone is better off.
 
Sig said:
So you claim that the dozen or so independent public and private sources that calculated inflation between 1.5% and 2% every year using reams of quantatative data since 2012 are all in collusion and wrong in the same direction and amount? Again simply because you say so?
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No, not because I simply say so, but because i have open eyes and see the prices I pay for goods and services increasing by waaaay more than 2% year over year ever since the Fed started printing money... I'm guessing your butler or personal assistant is doing your shopping and you don't even bother to check the bills... too busy winning people over to notice reality? :)

And don't tell me those "independent public and private sources" you mention are really independent or worthy of trust and not just manipulated. Also, why don't you follow your own advice and provide some hard facts on this, instead of simply your words. What "independent" sources? A list please..:)
 
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