Another day another dove, this is how pathetic they have become, do you know whats going to happen in 2016? Nothing, they aren't raising rates today or tomorrow, they aren't raising rates at all, there is such an addiction to zero interest rates that raising them just 1/2 of a percent would cause a collapse on wall street, the fed has lost every bit of credibility they have had, which wasn't much to begin with, but now with every fed member playing a damn guessing game on when rates are going higher means they aren't going anywhere anytime soon...this is a joke filled with lies, anyone believing what they say is the real fool, I can almost guarantee that they will be doing QE 4 before rates get back to 2%, if the economy can barely grow with rates at 0%, do you really think it can function at a 1% fed funds rate, the answer is NOOOO, this is how pathetic this economy is even after the trillions the fed spent to prop it up. All it did was feed wall street and the elite, oh and create the next asset bubble thats bigger than the dot com and housing bubble combined, but no worries, it should be a wonderful site to see how the fed gets out of the next crisis, cant wait to see what magic they pull out of their hat this time... Fed's Evans: Not appropriate to raise rates until early 2016 based on Q1 data Jacob Pramuk | @jacobpramuk 3 Hours AgoCNBC.com Hiking the federal funds rate does not seem appropriate until next year in the wake of weak first-quarter economic data, a top Federal Reserve official said Monday. First-quarter struggles for the U.S. economy make monetary policy tightening more feasible sometime in early 2016, said Charles Evans, president of the Federal Reserve Bank of Chicago, in prepared remarks in Columbus, Indiana on Monday. Read MoreWall Street getting bitter dose of economic reality The Commerce Department said last Wednesday that the U.S. economy expanded at a 0.2 percent annual rate. David A. Grogan | CNBC Charles Evans First-quarter weakness looked "transitory," he said, echoing the sentiment in the Federal Open Market Committee's most recent statement. Evans is a voting member of the Fed's policy making committee.
They have zero ideas what to do....that's why this market is in major trouble especially once we go back into a recession with rates already at 0% .... More QE4 is all they have in mind...that will be another complete failure
In a vacuum I feel like they can raise rates a little at years end with a healthy stock correction following; however, we are not in a vacuum, the world has now embarked on full blown currency wars - Australians lowered rates yesterday to 2% even though they have a housing bubble closing in on 400% gains, Japan and Europe are easing and buying up Treasuries, Japan now exceeding China in Treasury holdings. So outside of the theoretical vacuum the Fed is almost forced to react and devalue. Does anyone see any other scenario than QE4? We all saw what happened to the Swiss Franc when they chose to have a hard currency while the rest of the world devalued - it went to the moon; can the USA really afford that?
Swiss is doing fine except their moronic Central bank everybody is superhappy with strong currency as far as I know (I mean people not corporations)
No, I think the Fed will eventually want to keep the printing going. The real question is how does this stop? What's the end game? Everyone prints from now to eternity? That certainly won't end well. If the Fed shows real courage (seriously doubt this) it may resist. It's not like the US is a massive export driven machine. We've been running deficit's forever (excluding the oil complex). A strong dollar will bring deflation for the time being, but maybe that's not such a bad thing in the short run (see deflation thread).
Governments are always trying to stop markets from moving to an equilibrium price that their own policies have fostered. A few decades ago they put on wage and price controls to try to stop the inflation that the gov't had caused. Now, governments have issued gigantic mountains of debt and they don't wish for interest rates to go to the price the mkt would dictate. Hence, QE. Just their effort to suppress interest rate increases that their own policies have caused. Wage and price controls work for awhile, but markets always win out in the end. It's only a matter of time.
Current Fed Fund Futures pricing in 33% of rate hike in Sept. I think this is woefully under priced. It should double that in the next month.