Will the FED be taking down Trump or was this rate hike appropriate?

[TJustice]

What you wrote is ignorant partisan detritus. Both sides are responsible... and the FED.
The damage has been done beginning in the 90s...

The impacts were hidden due to cheap money.

All of this talk about rates being historically low or high is nonsense. Rates are what they need to be at a certain time. Rates were higher in the past because of inflation, we do not have the inflation of the 1970s and the unemployment of the 1980s.

The Fed did not ruin jack shit, they abided their mandate in place of republicans being unwilling to use the government because they are stuck on some outdated and plain old stupid ideology.

The Fed does need to increase rates for the coming slowdown and they do need to unload some of the balance sheet to reload it later.

You all underestimate the damage republicans have done because you just don’t care about math and believe in magic beans.

Trumps economy is a cotton candy economy. The kids ran out the sugar high of tax cuts and are falling asleep in the backseat now. Look at what FedEx is projecting for next year with all the problems associated with instability and trade and debt.

We are screwed and the republicans are fucking crazy and will be no help, this stalling the government and stagnating the economy. The Fed is the only hope we will have because of political insanity. They must load rates and reduce the balance sheet.

 

[UsualName]

What you wrote is ignorant partisan detritus. Both sides are responsible... and the FED.
The damage has been done beginning in the 90s...

The impacts were hidden due to cheap money.

This from the guy who says we can take on infinite debt and the fed can print all the money we will ever need without any negative effects.

I’ve been telling all of you this is coming since the tax package. Tax cuts are not an economic growth plan, they’re a gimmick. Growth takes trade and investment. The trump administration has not created an environment for growth. The outlook is negative because of this. There are no magic beans.

The 2 year 5 year yield inverted earlier this month, way before the fed. Business leaders and consumers are inline with a tightening in the market. The ten and two are signaling a peak in the business cycle.

That is an analysis of the macro fundamentals- it is not the feds fault we are going to recession, it’s the president’s and the republicans in Congress. They fucked up a good thing because they’re stupid.

 

[TJustice]

1. You completely misrepresent the points I made in the past. I have asked why is anyone getting worked up the debt when we don't even keep track of how much money the FED creates.

The country could be printing that money and not taking out loans for it.

2. Tax cuts should be designed to stimulate investment.
When people analyze investment opportunities they frequently look at how much money an invest throws off after taxes. And then they have to look at much money they will pay on the return. At high enough tax levels risking the money does not make sense.

Anybody in business understands you calculate investment risk vs reward.

3. Nothing you said explains why this is a republican issue and not a democrat issue.
Obama had 8 years to see the economy do well... our recover was anemic... particularly in light of the fact interest rates were kept so low. It was a garbage recovery because the govt and the FED interference blocked the creative destruction our economy needed.

Trump may be in part responsible but its mostly a weak economy which grew based on cheap money and a tax cut causing market gains because companies had more profits. The investments that cut could cause would hardly have time to even mature into a stronger economy by now.

Both parties suck this is not a partisan issue. I

This from the guy who says we can take on infinite debt and the fed can print all the money we will ever need without any negative effects.

I’ve been telling all of you this is coming since the tax package. Tax cuts are not an economic growth plan, they’re a gimmick. Growth takes trade and investment. The trump administration has not created an environment for growth. The outlook is negative because of this. There are no magic beans.

The 2 year 5 year yield inverted earlier this month, way before the fed. Business leaders and consumers are inline with a tightening in the market. The ten and two are signaling a peak in the business cycle.

That is an analysis of the macro fundamentals- it is not the feds fault we are going to recession, it’s the president’s and the republicans in Congress. They fucked up a good thing because they’re stupid.

 

[UsualName]

1. You completely misrepresent the points I made in the past. I have asked why is anyone getting worked up the debt when we don't even keep track of how much money the FED creates.

The country could be printing that money and not taking out loans for it.

2. Tax cuts should be designed to stimulate investment.
When people analyze investment opportunities they frequently look at how much money an invest throws off after taxes. And then they have to look at much money they will pay on the return. At high enough tax levels risking the money does not make sense.

Anybody in business understands you calculate investment risk vs reward.

3. Nothing you said explains why this is a republican issue and not a democrat issue.
Obama had 8 years to see the economy do well... our recover was anemic... particularly in light of the fact interest rates were kept so low. It was a garbage recovery because the govt and the FED interference blocked the creative destruction our economy needed.

Trump may be in part responsible but its mostly a weak economy which grew based on cheap money and a tax cut causing market gains because companies had more profits. The investments that cut could cause would hardly have time to even mature into a stronger economy by now.

Both parties suck this is not a partisan issue. I

First of all you’re a paper trader and don’t understand the Fed. You think the Fed has an impact to pull the economy into recession on its own but your wrong. The fed plays a role in the economy but the government itself is the most important player in this county and every other country on the planet. So don’t tell me the government should not be involved because that would be stupid too, to unilaterally disarm while economies like China and the EU use government to their advantage.

Second, you don’t get to tell me about risk/reward analysis. I’ve done it. I’ve built two businesses. Taxes are column c operating costs. It is absolutely true I have taken advantage of tax incentives for capital and Human Resources investments. But an across the board tax cut is just money in the bank. It’s a gimmick that will not lead to any growth but simply pay off owners and investors at the expense of the country and the working class.

Growth is created by trade and investment. I don’t think you understand this because you are putting the cart before the horse. Meaning there is no incentive for investment without an opportunity for growth. Growth comes from consumption, consumption comes from demand, trade satisfies demand. Opening new trading deals, not destroying existing ones creates growth.

TPP was an excellent opportunity to increase trade. There is incredible demand for American technology and pharmaceuticals in Southeast Asia and TPP would have built on that along with opening many markets for other competitive goods and services - with the addition of building a trading block capable of pressuring China to come into line with standard trading practices.

That was scrapped- and here’s where you will get an agreyfrom me - because of populist stupidity from both parties in the last election.

Now, Trump is a chaotic and destructive force. He is engaging in destructive economic policies. The destabilization of the markets in the world by his bullying and ignorance and his lacking ability to open new trading opportunities has caused a slow down in growth.

Republicans themselves have engaged in a governing philosophy that completely ignores working people and the need for education and wage growth. Rather than invest in the workforce, they opted to pay off wealthy Americans and leave the already struggling working people to hold the bag.

The republicans have created such a mess that we could actually end up ina worst case scenario that sees a large recession with a relatively high amount of inflation due to their tax and trade policies.

 

[Scataphagos]

It seems to me with all the CEOs warning about their fears of a recession and the stall in the housing market a Fed hike was a pretty dangerous move.

Not as dangerous as the Bernanke Fed and Yellen fed leaving interest rates at zero for so long.

 

[TJustice]

1. Papertrader. What the hell are you talking about. I traded for a living and trained and backed other traders back in the day when I had a big edge.

2. Who said the govt should not be involved? not me. The problem is our govt (both parties) are doing things for the cronies rather than doing what is best for the country.

3. Central bankers create trillions of dollars and can direct where the money is invested or borrowed. You are nuts if you don't understand how powerful creating money is. Eventually those tied to the FED spigot may gather in all the assets and the politicians.

4. Hillary (her public face) and many dems were against TPP also. It was really bad for the environment as it removed control from the US. Your talking points about TPP sound great. The realty of TPP would have been far different. You think there was a giant sucking sound after NAFTA... TPP would have be worse.

4. Democrats can't talk about wages and working people as they have imported 40 million people to keep wages down for their crony masters.
On any scale that is a travesty for wages.
In my area I meet qualcomm engineers at just about every kids soccer game. The was who were born and went to school here complain about how their wages have been held down all the time.

5. Both parties are run by those with money. Neither side has done just about anything good for American workers and income tax payers since Reagan.

First of all you’re a paper trader and don’t understand the Fed. You think the Fed has an impact to pull the economy into recession on its own but your wrong. The fed plays a role in the economy but the government itself is the most important player in this county and every other country on the planet. So don’t tell me the government should not be involved because that would be stupid too, to unilaterally disarm while economies like China and the EU use government to their advantage.

Second, you don’t get to tell me about risk/reward analysis. I’ve done it. I’ve built two businesses. Taxes are column c operating costs. It is absolutely true I have taken advantage of tax incentives for capital and Human Resources investments. But an across the board tax cut is just money in the bank. It’s a gimmick that will not lead to any growth but simply pay off owners and investors at the expense of the country and the working class.

Growth is created by trade and investment. I don’t think you understand this because you are putting the cart before the horse. Meaning there is no incentive for investment without an opportunity for growth. Growth comes from consumption, consumption comes from demand, trade satisfies demand. Opening new trading deals, not destroying existing ones creates growth.

TPP was an excellent opportunity to increase trade. There is incredible demand for American technology and pharmaceuticals in Southeast Asia and TPP would have built on that along with opening many markets for other competitive goods and services - with the addition of building a trading block capable of pressuring China to come into line with standard trading practices.

That was scrapped- and here’s where you will get an agreyfrom me - because of populist stupidity from both parties in the last election.

Now, Trump is a chaotic and destructive force. He is engaging in destructive economic policies. The destabilization of the markets in the world by his bullying and ignorance and his lacking ability to open new trading opportunities has caused a slow down in growth.

Republicans themselves have engaged in a governing philosophy that completely ignores working people and the need for education and wage growth. Rather than invest in the workforce, they opted to pay off wealthy Americans and leave the already struggling working people to hold the bag.

The republicans have created such a mess that we could actually end up ina worst case scenario that sees a large recession with a relatively high amount of inflation due to their tax and trade policies.

 

[TJustice]

I just re read your post.

Your post is an almost perfect post. Short, but powerful because of its insight.
Pound for pound... the most intelligent economic statement of the year... on the net or anywhere.

It deserves to be read until full appreciation.

I would add for the those who can't appreciate... .

What the hell is the FED doing?
Why should it be trying to prevent wage increases?
How can anyone defend that sort of ass backwards thinking.

If you look back at the recent history of the Fed, they have consistently acted to undermine republican presidents. It happened with Bush 41, allowing Clinton to run against the "Bush recession", even though the economy was in fact recovering. It happened at the end of Bush 43's second term, when the idiot Bernanke raised rates precipitously after allowing a housing bubble to inflate on his watch. The Fed then graciously undertook a zero interest rate policy for the entire eight years of Obama's disastrous presidency, allowing him to run up monstrous debt and brag about an economy that was in fact suffering from his policy mistakes. Barely a year after Trump took office the Fed was back to raising rates, even though inflation is nonexistent.

The Fed's current obsession with raising rates happens to directly undermine Trump's two biggest economic success stories. One is raising the incomes of his working class base. Obama's economy made Wall Street and Silicon Valley execs rich, and of course they showered him with money in response. Wage earners were a different story. They saw their jobs sent overseas or replaced with cheap immigrants. The Fed paradoxically is fixated on wage costs as justification for raising rates. So to the extent Trump helps the working class, the Fed tries to take it away. This shows some real chutzpah since they were so desperate to bail out the bankers, whatever the cost.

Trump's other economic success story, forcing the Chinese to bend the knee on trade, is also directly undermined by the Fed. As rates go up, so does the dollar, and the effect of Trump's tariffs is negated. In effect, we are manipulating the Chinese's currency for them. Or to put it another way, one part of the government has its foot on the accelerator while the other is on the brakes.

The stock market is scared and rightly so. The Fed has a terrible record and has repeatedly made the exact same policy mistake that seems on the launching pad now. By using lagging data like employment stats, they tighten for too long and create a recession. In this case, that recession should coincide nicely with the 2020 elections. Accident? Bad luck? Once or twice, maybe. When it happens election after election, you begin to wonder if the "career professionals" at the Fed are as politicized as their counterparts at the DOJ, IRS and FBI.

 

[CaptainObvious]

Recessions are normal and healthy, the rid the economy of not only malinvestment but also of Republican presidents.

Always happens during the last year or two of Republican presidents. How fortunate for the left and since we all know these things are years in the making one must wonder if AAA is correct.

 

[UsualName]

1. Papertrader. What the hell are you talking about. I traded for a living and trained and backed other traders back in the day when I had a big edge. Although understand what the FED was doing could be sort of a context edge it really did not matter that much to making a living. In general you go with the FED and watch the yield curve. However back in the late 90s and early 2000s once a quarter there was one FED edge. Back then we had a feed from the s&p floor. If Merril Lynch was buying or selling in size the day before a FED announcement you knew which way the announcement was going the next day. It was so amazing to me it forced me to go do research. Guess what I learned. Banks owned the shares of the FED and had complete practical control of the Fed. ( I can explain it to you if you wish)

2.
Who said the govt should not be involved? not me. The problem is our govt (both parties) are doing things for the cronies rather than doing what is best for the country.

3. Central bankers create trillions of dollars and can direct where the money is invested or borrowed. You are nuts if you don't understand how powerful creating money is. Eventually those tied to the FED spigot may gather in all the assets and the politicians.

4. Hillary (her public face) and many dems were against TPP also. It was really bad for the environment as it removed control from the US. Your talking points about TPP sound great. The realty of TPP would have been far different. You think there was a giant sucking sound after NAFTA... TPP would have be worse.

4. Democrats can't talk about wages and working people as they have imported 40 million people to keep wages down for their crony masters.
On any scale that is a travesty for wages.
In my area I meet qualcomm engineers at just about every kids soccer game. The was who were born and went to school here complain about how their wages have been held down all the time.

5. Both parties are run by those with money. Neither side has done just about anything good for American workers and income tax payers since Reagan.

We arent giving bailouts to farmers because of the fed.

 

[UsualName]

Always happens during the last year or two of Republican presidents. How fortunate for the left and since we all know these things are years in the making one must wonder if AAA is correct.

Right. Republican presidents end up with recessions when their policies have overtaken the previous administration’s.