That is one incredible looking chart... absolutely amazing.....cnbc should plaster that chart right up front so they can have their guest speakers decipher it....a 14 day RSI at Fu©king 90... 7500+ point move up with zero pullback and everyone is nonchalant about it....... something is very wrong
The central bank knows they created this and they know it's way too late to stop it so they will watch it implode ....they even mentioned the other day that when the next recession comes they have absolutely no room to lower rates since Everytime there has been a recession or a slow down they have been able to move rates lower after having rates at 5-6-7%, with rates below 2% where are they going to move once the recession comes?
It's quite okay...I wouldn't say clueless.....what you don't comprehend is that the fed has backed this market each step of the way and without them intervening these historical highs would have never taken place....it will be after the collapse comes and the next crisis that you will have all your direct answers from the fed as they get grilled on Capitol Hill but of course we don't know when that's going to take place since every thing is rainbows blue skies and butterflies....
Here you go.....the fed knows they Fu©ked up and are just saying it now so that no one is surprised when it happens...sort of like I told you so!!! They are admitting that during the next recession they will not have the 5 points to lower rates to 0% to jump start the economy once the recession takes places.....well whose Fu©king fault is that....the fed has been bowing to wallstreet saying inflation is under control, so let's keep rates near 0% for a decade....little do they know is that inflation has been alot higher than 2%..... So now what??? the fed clearly knows that the fed funds rate will never get to 5% and that a recession is surely to come first, they can't raise rates to 5% anyway due to the trillions of outstanding debt within the US and the hundreds of trillions in debt the world is in sooo raising rates to 5% is impossible.... The Fed, worrying about the next recession, considers changes More and more, Fed officials are beginning to think seriously about a dramatic change to monetary policy that would revise or even scrap its current, flailing 2 percent inflation target. Economist Larry Summers notes that the Fed typically has lowered interest rates by 5 percentage points over time to stimulate the economy in recessions, but it doesn't have 5 points now. The solution gaining the most traction and mention by officials and academics is called "price-level targeting." Steve Liesman | @steveliesman Published 12:00 PM ET Wed, 10 Jan 2018Updated 3:06 PM ET Wed, 10 Jan 2018 Even while the economy and markets are booming, Federal Reserve officials are worrying about how they'll respond to the next recession, and they don't especially like the picture they see. It's one where the economy starts contracting but the Fed, still at a low interest rate, has little ability to respond. It lowers rates to zero but that amounts to only a fraction of the stimulus it has provided in past downturns. Once again, the Fed faces the quandary of what more it can do when it's at zero and can't cut anymore and is forced to contemplate extraordinary, uncertain and controversial measures like quantitative easing. More and more, Fed officials and academic economists are wondering if there's a better way and beginning to think seriously about a dramatic change to monetary policy that would revise or even scrap its current, flailing 2 percent inflation target. The Fed has missed that target almost since it was implemented in 2012, undermining its credibility in markets and possibly entrenching expectations that inflation will always run below target. Former Treasury Secretary Larry Summers, speaking at a Brookings Institution conference this week on the Fed's inflation target problem, urged the Fed to get moving on a fix. He noted that the Fed typically has lowered interest rates by 5 percentage points over time to stimulate the economy in recessions. The Fed doesn't have 5 points now, so the next recession will find the central bank less able to kick-start growth, possibly enabling a longer, deeper downturn. "The overwhelming likelihood is that when recession comes, policy will not have sufficient room to cut rates as much as it would like to within the current framework,'' Summers said. Quoting a recent research paper, Summers suggested the Fed could be at a zero interest rate 30 to 40 percent of the time in the future unless it changes its current regime. "I am completely unconvinced that (quantitative easing) can be our salvation next time around,'' Summers said. Out of fiscal bullets as well? The recent tax bill, which boosted the deficit outlook, means the fiscal side will have less ability to respond next time around as well. The solution gaining the most traction and mention by officials and academics is called "price-level targeting," and at least three Fed officials in recent weeks have talked about it, though with varying levels of support. Currently, Fed policy calls for the Fed to hit a 2 percent inflation target over time. It continues to shoot for that inflation rate even while it continuously misses that goal. Price-level targeting would ratchet up the seriousness of the effort. It would account for those past misses and prompt the Fed to aim for a higher target in the future to make up for its prior shortcomings. The belief is that this would convince markets and consumers of the Fed's commitment, running a higher inflation rate to account for prior gaps. "The price-level target will keep rates lower for longer,'' San Francisco Fed President John Williams said at the Brookings conference. Williams has been among the most outspoken advocates of making the change. Over time, it's hoped that a price-level target would keep the Fed away from zero, giving the policymakers ammunition to fight the next recession. Cleveland Fed President Loretta Mester spoke last week on several changes, including price-level targeting, saying the Fed could consider changes to its inflation target, but she was careful not to advocate any single solution. "Each framework is worthy of further study, and now may be an appropriate time to undertake such study because the economy is growing, labor markets are strong and inflation is projected to move back to our goal," Mester said. Boston Fed President Eric Rosengren also advocated discussion of the topic, noting the Fed's persistent failure to hit its target. "The Great Recession was a big enough event that we might want to reassess and say, "How do we make sure we don't have those kinds of events?" he said at Brookings. There's little conviction that price-level targeting or any of the alternatives is a silver bullet. Some wonder why the Fed, if it can't hit its inflation target, will be able to hit a price-level target. By advocating higher inflation for a time, there's concern that the Fed will introduce more volatility to both inflation and growth. And practically speaking, any change is a long way off. Fed Chairman nominee Jerome Powell hasn't been approved yet by the Senate, though he's supposed to start his term in three weeks. Former Fed Chairman Ben Bernanke, an advocate of a variant of price-level targeting, says the new chairman will likely appoint a committee to discuss the issue and the debate could take a year to 18 months. "Somewhere in 2019 there will be some pretty serious discussions," Bernanke said. At the slow pace that the Fed changes policy and regimes, if it wants to change something in two years, it better begin talking about it now. But no one can say if that change will take place in time for the next downturn.
That's exactly it....funny how the economy booms when the entire country and world is trillions in debt.... Wonder how come individuals are penalized with low credit scores, high APRs and even the chance of not getting a job because of their credit history but an entire country awashed in trillions of debt is perfectly fine....I say if the country can go into trillions of debt and not get a slap in the wrist so should every citizen of the US...
This is the third article headline I'm reading today where more people are getting bonuses and pay raises...this time $2000 bonuses out of fiat Fiat Chrysler to invest more than $1 billion in Michigan plant and give $2,000 bonuses in response to tax reform So this is all they had to do was cut corporate tax rates from 35% to 21% to give big bonuses out and rally the stock market to historical highs day after day after day???? Why didn't this happen decades ago if it was such a simple matter.... I mean all of the sudden everyone is getting big bonuses, pay raises and stocks are in melt up mode...that's all they had to do? So simple...they should just lower the tax rate to 2% and give everyone 6 figure incomes and 5 figure bonuses...will see GDP increase 14 fold and everything will be picture perfect....