The S&P 500 will top soon at 2925-2930

I'm patiently waiting for a fed funds rate below 1% and a recession train coming at full speed. Oh how lovely it will look when the fed has no where to go...
Too many years have gone by with the fed propping, eventually something has to give!!

 

As traders do we care who is responsible for the gains?

 

They can always follow Germany, Japan and Switzerland, push interest rate below zero.

 

How fast can this drop? Or will it be flattish for a long long time?

 

Yep - I recall that Japan went for at least a decade (this is recollection off the top of my head) with negative interest rates.

And the ECB and the BOJ have already signaled the markets that a rate cut is in the offing.

 

There is no mathematical reason why it can't be below zero, absent some way to arbitrage it.

 

I never understood why I want to pay someone to hold my cash when I can just put them in my bank vault or safety deposit box and is readily available. When I pay someone to hold my cash I have an added risk: That someone could take my cash and disappear.

 

We got negative interest rates here in Sweden too

 

In a market, it is the marginal buyer that counts. You are not a buyer, but there are others, and that is all that matters.

 

Basis traders (and they are freaking huge in the market) could really care less, since they are spreading OTR or OffTR Cash versus futures versus Overnight Repo Rate. The cash flows are trash, but be that as it may...