So basically Bernane promised rate hike

Discussion in 'Trading' started by kashirin, Jun 9, 2008.

  1. no later than August.

    Actually I think it's gonna happen in June

    he has no choice if he don't hike and ECB does - it will be ugly
  2. A small rate hike not the end of the world

  3. These are your words not Bernankes/ He would never hint a rate hike let alone do it when the economy is recovering.

    You must be out of your mind deluded or incapacitated in some way?

  4. Feds just cut rates why would they hike them any sooner? Just think about it how these people are trying to misinterpret and mislead you with these stupid posts which are nothing but puffed up explosions from their inner respiratory system.
  5. That's a good post, HT2.

  6. My opinion based on Fed futures that show 20% chance rate hike in June after Bernanke speech

    Also I would recommend you to check bond prices

    Do you think all those people out of their mind

    Bernanke has no choice - rate hike or 150$ oil
  7. I can hardly wait. Most of these funds are going under.

    I guess the Banks got rid of all their Bad Paper.

    The Fed Bought a lot. How much? Who bought the rest?

    Time to short those funds and CDO's....
  8. Apparently you like demonstrating how little you do know about finance and economics. Raising interest rates fairly soon is actually a very good idea which is precisely why the FED is hinting that it will do it very soon. Contrary to your obvious ignorance of how the markets work, when the Fed does start raising rates, the markets will very much welcome the move. I could sit here and explain the many reasons why raising rates is a very good idea, but maybe this will force you to do your homework and study why the Fed would make this move and why the financial markets would be in favor of that move.
  9. .
    The only time a hike is welcomed - during an overheated economy, where commodity *demand* is high and wage-based inflation is real and growing.

    The economy is very weak, now. Use the market as a proxy.

    Hiking rates in a weak economy will put a big hurt on borrowers and collapse the already faltering subprime

    Are you aware the major US banks own the Federal Reserve? Perhaps its in their best interest - and not the overall economy - that rates are raised now.

    Perhaps all that bad paper that will default on higher rates is no longer in their possession, hence their willingness to have Bernack start a tightening cycle.

    Squashing the commodity run up is beneficial to the economy. But jacked rates is going squash more than energy.

    Care to elaborate on your reasoning?
  10. bologna. It is seriously in the best interest of the economy to raise rates.

    There are fundamentally a number of reasons why interest rates should be raised right now, and they are all well correlated.

    Number 1: Inflation is very high right now. Raising interest rates will help combat this in two ways. First, it will help spurn more foreign investment into the US markets. Historically, foreign money is attracted to higher interest economies. The reasons should be obvious why it would gravitate towards those economies. Now, the US economy has been able to buck that normal trend because of the maturity and stability of the US economy and the dollar. Right now, the dollar is extremely weak though. Top that off with low interest rates, and foreign money has no incentive to invest in American securities. If you think American investment alone is going to pull us out of this hole, you're living in a pipe dream.

    Number 2: Raising rates should also help to increase the demand for the USD. This should help strengthen the dollar. Again, it will attract foreign investment and will help drive down inflation. Right now, the benefits of low interest rates are not offsetting the disadvantages. We need to strengthen the dollar and we need to attract more foreign investment. *This* will strengthen the American economy much more efficiently than a stagflation with low interest rates.
    #10     Jun 10, 2008