According to the fed funds data just 24 hrs ago. The chances of a rate cut were already at 75%, what powell said today was absolutely nothing new. He knew he had to speak as dovish as possible because he knows he has to bow down to wallstreet .... Its interesting though, all this talk now about unemployment ticking higher and job losses mounting yet equities keep rising, last I heard was that gdp makes up 70% of consumer spending....wellllllll if unemployment. Is ticking higher and jobs losses are mounting why are stocks completely ignoring this huge red flag???? Just very odd that they are using the unemployment figures as an excuse to lower rates when wallstreet is literally having an absolute party .....if everything according to the data is showing a resilient economy and block buster earnings then why are they ever so desperate for these rate cuts........
Would be interesting to see the next jobs number show quite a gain in jobs and then the fed funds rate suggesting now only a 38% chance of a rate cut in September or better yet the fool cuts rates in sept and December and then an uptick in inflation starts to pop up. Markets would really get a kick out of that. Also will be interesting to see where the 10 yr ends up during these rate cuts .... They also believe cutting the rates will bring mortgage rates lower, thats why homebuilders are jumping again....however with more demand in housing if rates do drop will only once again cause another move higher in housing prices... Also anticipating what rate cuts will do to the 10 year .....maybe it jolts towards 5%, that would cause major havoc in the markets.
A top??? Dont say that too loud..... I keep hearing that there is no top in sight...that s&p will keep jumping and end the year up above 7000 and beyond...
a top would be when @S2007S shuts the fuck up with drama post... but that will only happen when a tv with a channel changer is invented for liberals
Repeat after me . Rates high or low is both good for the market . Low rates means cheap money stimulates the economy . High rates good too because it means the economy is super strong thus earnings good . Dollar weak is good because I means it means we buy more domestic things as imports more expensive. Strong dollar good because it means are purchasing power more . Weak earnings not even really bad because " wall streets grunt running the turn in earnings 1 year out " . The biggest shock to all is how p/e's expanded so much in the face of rates going from 0- 5.5% basically . The moral of the story is simple . The last 35 years the stock mkt and asset prices have become the most important part if the economy . The wealth effect is the #1 thing that determines what we spend . If our accounts are high we spend more as our wealth on paper determines are spending habits . I leave you with this . Asset prices will never stay down . The govt would rather have mass inflation and high asset prices than low asset prices and a recession/ depression. Pick your poison
The day before, members were out saying its not appropriate. I was surprised he is cutting. Usually the fed leaks info to the market purposely through fed members. Higher rates are bad if there is inflation with a slowing job market.