What time are you talking about ? 8pm ? but Dax futures down indeed, already below pre fomc levels, eurusd up 2.7%, so euro stock might take some heat from it, DAX and CAC40 have not correlated very well with the SPX these last few days, when there were strong eurusd moves.
You know price being at all time highs doesn't mean we are in a bubble. The PE of the nasdaq composite was 566 in 1999. Today it's 29: in line with where it's been since 2003.
Sorry I meant 7pm Europe CET time (winter daylight saving, when the US is already in summer time), so am used to 8pm FOMC time, hence mistake... Europe strongly overperformed (CAC DAX) the S&P lately due to € weakness. As I have said earlier this week, who wants to short $ below 1.05??? That s just crazy, strong rebound was to be expected, 1st 1.14 then 1.30. Could b very quick. In the meantime all that overperformance in Europe will vanish and then, some more... like it always does...
Its a stock bubble IMO when you put a fed funds line below the 20 year stock index chart. If you were on an island for 10 years and saw that unlike all recent past bull markets, we were still at .1% at the all time high then I would say, WTF? "How can the fed still be screamimg GO, MORE, CHARGE with equities where they presently are? " Stocks should not all time highs as a discounting machine with gloomy growth and earnings projections. I as well beleive the fed does not have cash on hand to "swap" assets. Money credited to bank reserves is created and increases M2. That seems to be they only result of QE as further, intended M2 money creation due to loans from bank reserves is non-existent. Some money creation, probably ZIRP loans to asset managers must be "getting out there" to fund asset purchases. Seems to me the fed still cant bring themselves to signal this party is ending anytime soon even though they know this is FUBAR.
Thats exactly right, you have to think where is the common sense, they lack it completely...they are keeping rates at 0% just to fuel the rally even higher, they will not and cannot admit there is a bubble, no one sitting at the head of the fed is going to admit there is a bubble or that asset prices are to high, BUBBLE ben bernanke never admitted either, greenspan never admitted it....they will never admit it, not in a trillion years would they, they will only acknowledge it after the fact, they only acknowledge the problem after they have to fix the problem, when the truth is they created the problem, no one is comprehending this, rates should not be at 0%, I keep hearing how the economy is doing so well, blah blah etc etc etc, then why the fuck are rates at 0%....it will be proven in due time that they will be wrong again, they think with a market at historical highs that they have been right all along, but little do they know they have no idea whats coming to them......
This is from a blog feed I found on Market watch, its not exactly what I wanted but close enough, Ill look for the full conversation in the next day or so, but this is what I found... She DECLINED to answer one of the reporters question about he view on the stock-market valuations, I wonder why........again this fed is so fucking dovish its disgusting....they will bow down to wall street continously no matter what!!!! I can't wait till they have to come and fix the next crisis because its going to be quite a show..... Janet Yellen declined Wednesday to update reporters on her views on stock-market valuations. (Last July she said biotech and social media sectors, in particular, appeared stretched.). The tech-heavy Nasdaq didn’t need an endorsement to again break the 5,000 threshold, hitting an intraday high above 5,001 as equities extended across-the-board gains. The Nasdaq broke 5,000 earlier this year for the first time since 2000. As for Yellen, she said she didn’t want to comment on particular sectors, but that, as the Fed had noted, overall equity valuations “appear on the high side but not outside of historical ranges.”
Yesterday I mentioned that after the announcement that yellen would come out and bow to wall street with her dovish talking at her q&a conference and she did EXACTLY that, she gave wall street once again the most DOVISH statements she could possibly give.... I mean you can't make this up, everything wall street wanted they got today, here is why markets rallied.... So looking at this you notice that rates are predicted to be .50% lower by the end of 2015 than originally noted, a rise to .625% instead of the 1.125% as once predicted.....for 2016 a .625% decrease in the median rate than was what originally thought....and now they see the economy growing slower, slower???? really, slower? I keep hearing how off the charts this economy is doing especially with unemployment falling below 5% in the next year or so...so when will the fed admit that these zero rates and a 5.5% unemployment rate and the trillions they pushed through the system aren't working, I want to know immediately what their next step is to push growth higher going forward, if they can't get the growth they want of 3%+ gdp with zero rates then what is wrong with this picture, why are stocks booming like we just entered a new fucking industrial revolution yet gdp predictions are falling??? Just keep these fed notes near by and come back to them in December, I can guarantee you rates will not even be above .25% at the end of 2015 and by end of 2016 you will be lucky to see rates above 1%, by then markets will be in turmoil and any rate hike will be long forgotten about as the fed tries to stave off the next collapse. WASHINGTON (MarketWatch) — The Federal Reserve will raise interest rates far more slowly than previously expected, according to the central bank’s updated “dot plot.” The Fed’s latest dot plot shows that top officials expect the median federal funds rate, now near zero, to rise to 0.625% by end of 2015 instead of 1.125% as predicted in December. For 2016, the median rate is expected to end at 1.875% instead of 2.5%. Also see live blog of Yellen press conference In the “longer run,” the Fed sees the median rate climbing to 3.75%, the same as before. The slower pace of rate hikes likely stems from the Fed’s more subdued assessment of U.S. economic growth. The bank sees the economy growing 2.3% to 2.7% in 2015, below its prior target of 2.5% to 3%. Nor does the Fed see the U.S. growing more than 2.7% in 2016 or 2017, even with the unemployment expected to fall to as low as 4.8% from its current 5.5% level. http://www.marketwatch.com/story/fe...-path-of-rate-hikes-2015-03-18?dist=afterbell
http://www.zerohedge.com/news/2015-03-18/here-why-fed-cant-hike-rates-even-025 See this? Not knowing much i have wondered , 1) if 2.5 T in reserves can be used in Teir 1 capital ratios 2) if 2.5 T in reserves can serve as margin. This expert at least implies it can in highly levered , traditional , long only bond funds. Appears to be another way the fed is boxed in. I dont know how a 25 basis point hike would transmit out on the rest of the curve and effect the spectrum of maturities that these bond mutual funds are positioned in, but , even a 25bp. Fed funds hike is thought will cause levered capital losses to these bond funds.