'Tis Not the Time to Dick Around, Mr, Jerome Powell. Cut the Damn Rates Now!

schizo

schizo

That's what I would suggest, if I were one of his minions. Because, as we already know, the chief economist effed up big time in the past when he reassured the public that he believed the inflation was tame and his team had it under control. Well, so much for his assurance.

These days, on the contrary, S&P500 and Nasdaq100 are trading at their all-time high but a slew of companies, especially big techs, are laying off employees in droves. Companies like Amazon, Microsoft, Google, BlackRock, Nike, Intel, and Citigroup all have announced plans for massive layoffs this year. And it would be a big mistake IMO to just sit back and enjoy the scenery, hoping everything will take care of itself.

I definitely think "it's different this time" with the introduction of AI. People who are let go might have a hard time finding new jobs. Also the economic crisis in China is looming in the background and I feel it will spill over to the global market.

So, in closing, Mr. Powell, get your ass moving. Don't wait until all the stars line up like you did before.
 
tony.m said:
Another inflation spike is on the cards by September.
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I, on the other hand, expect a full-blown recession by Q3. Once people lose their jobs and are thrown out on the street, inflation will be the last thing on Powell's mind.
 
schizo said:
That's what I would suggest, if I were one of his minions. Because, as we already know, the chief economist effed up big time in the past when he reassured the public that he believed the inflation was tame and his team had it under control. Well, so much for his assurance.

These days, on the contrary, S&P500 and Nasdaq100 are trading at their all-time high but a slew of companies, especially big techs, are laying off employees in droves. Companies like Amazon, Microsoft, Google, BlackRock, Nike, Intel, and Citigroup all have announced plans for massive layoffs this year. And it would be a big mistake IMO to just sit back and enjoy the scenery, hoping everything will take care of itself.

I definitely think "it's different this time" with the introduction of AI. People who are let go might have a hard time finding new jobs. Also the economic crisis in China is looming in the background and I feel it will spill over to the global market.

So, in closing, Mr. Powell, get your ass moving. Don't wait until all the stars line up like you did before.
More...


IMO, interest rates should be raised even more. Look at commodity prices; asset prices (stocks, housing, cars, etc.) as well as imaginary assets --e.g., cryptos, and only conclusion is there is still too much liquidity, due to Fed money-printing over decades.
 
Q.E.D. said:
IMO, interest rates should be raised even more. Look at commodity prices; asset prices (stocks, housing, cars, etc.) as well as imaginary assets --e.g., cryptos, and only conclusion is there is still too much liquidity, due to Fed money-printing over decades.
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You're right, we're in a bubble. But it's not gonna last. I'm pretty certain recession is around the corner, possibly starting Q3 of this year.

So, as with all previous recessions, I guess you can just wait for the asset bubble to pop and the economy to contract before making any rate cuts. Usually, in this case, the Fed belatedly realize they're behind the curve and go all out kamikaze and cut 50-75 BPS at a time. Sometimes, they will even make "surprise" cuts between FOMC meetings. This was pretty much the way the Fed handled the previous 4 recessions that I've witnessed.

Since the rate cuts can take up to 12 months to work itself down to the wider economy, why not proactively cut rates incrementally, say, 25 BPS at a time? This will give confidence to the investors since they know exactly what to expect. Otherwise, those last minute 50-75 BPS will only jolt the already nervous market in the end.

But I have a nasty feeling the Fed will stick to the same old script of sitting back and doing nothing until the whole house is on fire.
 
Structurally the US is headed for higher inflation in coming years because of government spending and increased environmental restrictions. The Fed is forced by the government to print money and to debase the valueof the dollar.

Smelter closure to wipe nearly 30% of US aluminum capacity
Discussion in 'Commodity Futures' started by Nighthawk, Yesterday at 10:09 PM.
 
schizo said:
That's what I would suggest, if I were one of his minions. Because, as we already know, the chief economist effed up big time in the past when he reassured the public that he believed the inflation was tame and his team had it under control. Well, so much for his assurance.

These days, on the contrary, S&P500 and Nasdaq100 are trading at their all-time high but a slew of companies, especially big techs, are laying off employees in droves. Companies like Amazon, Microsoft, Google, BlackRock, Nike, Intel, and Citigroup all have announced plans for massive layoffs this year. And it would be a big mistake IMO to just sit back and enjoy the scenery, hoping everything will take care of itself.

I definitely think "it's different this time" with the introduction of AI. People who are let go might have a hard time finding new jobs. Also the economic crisis in China is looming in the background and I feel it will spill over to the global market.

So, in closing, Mr. Powell, get your ass moving. Don't wait until all the stars line up like you did before.
More...

Did you lost tons of $$$ because of high interest rate?
 
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