Inflation isn’t exactly dead
Wall Street is counting on the Federal Reserve to stay on the sidelines until September and then resume cutting interest rates. Some big money advisors are even counting on the Fed to cut interest rates again before September. Bloomberg ran an interview this morning...Fed keeps interest rates steady; Treasury yields and dollar slip slightly
As expected the Federal Reserve held its benchmark interest rate steady at 1.5% to 1.75% today. The median forecast from Federal Reserve officials pointed to no change in interest rates through 2020. “Our economic outlook remains a favorable one despite global...
Could collapse of U.S.-China trade talks trigger a second Federal Reserve Put?
You’re aware, I hope, of the idea that there’s an implicit Federal Reserve put that undergirds a stock market trading near record highs. The idea is that Fed chair Jerome Powell, would move to cut interest rates to support stocks if the market looked like...
Fed report notes that continuing low interest rates could threaten U.S. (and global) financial security.
Well, duh. Yesterday Fed chairman Jerome Powell told the House Budget Committee that”we’re in a world of much lower interest rates.” He seemed to shrug his shoulders at the prospect as if to say, Hey that’s what it is and the Fed doesn’t...
Does Fed, market complacency make you nervous?
“The U.S. economy is the star economy these days,” Fed chair Jerome Powell told the House Budget Committee today, November 14. “There is no reason to think that I could see that the probability of a recession is at all elevated at this time.” “Our forecast is, and our...
Powell refuses chance to say the Fed is on interest rate hold through 2020
Given a chance to say that the Federal Reserve will keep its interest rate policy on hold through 2020, Fed chair Jerome Powell refused to take the bait at this morning’s testimony in front of the congressional Joint Economic Committee. “We see the current...
The Fed interest rate pause that …
Distresses? Refreshes? Isn’t important? Today, as expected the Federal Reserve cut the benchmark interest rate for the third time this year. The Fed lowers its benchmark rate 25 basis points to a range of 1.5% to 1.75%. At the same time the Fed signaled that it...
Fed minutes from September show debate on how low interest rates should go
Here’s the most important point, to me, from the minutes of the Federal Reserve’s September 18 meeting released today. At the meeting the Fed lowered interest rates by 25 basis points for the second time in 2019. “Several participants suggested that the...
The Powell Put underneath the financial markets and the U.S. economy just got stronger
It quacks like quantitative easing. It walks like quantitative easing. But it’s not quantitative easing. According to Federal Reserve chair Jerome Powell anyway. In a speech today, October 8, to the National Association for Business Economics, Powell said the...
Too much news for the next three weeks
Busy, busy, busy. Here’s what we know to be on tap for the rest of October as of today October 7. U.S.-China trade talks are set to resume on Thursday, October 10. That means a switch from a period when both nations were issuing statements and policy steps...
I think we can call this a data dependent market for Friday
The trend in U.S. financial markets this week has pointed down on data that shows the U.S. economy is slowing. Certainly the disappointing numbers in both the manufacturing and services Purchasing Managers Indexes have supported that conclusion. That could all change...
Are the foundations of this market looking a little ragged?
If you were an investor during the dotcom bubble of 1999 that turned into the dotcom bust of 2000 and then into an extended and painful bear market, then you now what we’re seeing now isn’t a comparable level of distress in the underpinnings of the...
Financial markets still showing signs of indigestion in debt auctions so Fed will pump another $75 billion into money markets tomorrow
Today, Friday, September 20, the Federal Reserve will buy another $75 billion in the overnight repo market. That brings the total this week to $203 billion in the Fed’s effort to stabilize the short-term markets that Wall Street uses to finance its purchases of...
With injection today of $75 billion into money markets Fed attempts to regain control of short-term interest rates
If $53 billion doesn’t work, try $75 billion more. The Federal Reserve injected $75 billion into U.S. money markets today after yesterday’s injection of $53 billion didn’t solve the problem. The problem is that the big Wall Street banks are finding...
Federal Reserve cuts interest rates by 25 basis points; Trump, financial markets disappointed by guidance on future cuts
Today the Federal Reserve lowered its main interest rate another 25 basis points to a range of 1.75% to 2%. To say that the Fed’s Open Market Committee was divided on the decision would be an extreme understatement: Five officials wanted to keep rates unchanged,...
The market wants to believe today–rallying ahead of the Fed?
As of 2 p.m. New York time U.S. stocks were higher on just about no meaningful news. To me it looks like the market wants to climb in the very near term–testing technical momentum to move to 2950 on the Standard & Poor’s 500 and maybe beyond. The...No consensus at the Fed in July for faster interest rate cuts, minutes show
The financial market didn’t get what it had hoped for out of today’s release of the minutes from the Federal Reserve’s July 31 meeting. The market was hoping for something in the minutes that pointed toward a shift in Fed policy toward an extended...
Markets bet that Fed will follow ECB this week to announce something “spectacular”
Gotta love that financial market enthusiasm for central banks. Last week the markets rallied on signals from the European Central Bank that it would cut its key interest rate–now at a negative 0.40%–to a negative -0.50%, lower the rates that banks pay to...
Central banks talk the markets up: Here we go again!
We’ve seen this play before: Financial markets start to tumble and central banks step in–not with actual stimulus quite yet but certainly with talk of stimulus. The European Central Bank and the German government took a turn today. Germany’s Der...
No let up in President Trump’s pressure on the Fed to cut interest rates faster
More tweets today from President Donald Trump in his campaign to pressure the Federal Reserve into more aggressive cuts to interest rates. “Incompetence is a terrible thing to watch, especially when things could be taken care of sooo easily. We will WIN anyway,” the...
Portfolio strategies for a changing market: What went up today when everything went down
For the last few weeks I’ve been working to shift gears in my online portfolios in anticipation of a tougher market after the Federal Reserve meeting (and a likely additional interest rate cut) on September 18. I’ve added Treasury ETFs–the Vanguard...
Financial markets fear what comes next in U.S.-China trade war
It would be unwise to assume that today’s retaliation by China is the last tit for tat in the U.S.-China war. What “reasonable” fears are making rounds today? That the Chinese decision to let the yuan break the 7-yuan-to-the-dollar barrier...
Decent job growth in July; bond market prices in 100% chance of another interest rate cut on September 18
The U.S. economy added 164,000 jobs in July. That’s down from the 193,000 jobs added in June (revised down from an initial 224,000) and slightly higher than the 160,000 jobs forecast by economists surveyed by Briefing.com. At 3.7% the headline unemployment rate...
Trump’s new round of China tariffs freaks out financial–especially bond–markets
So much for any hopes that the resumption of U.S-China trade talks would put an end to the tariff war in anything like the near term. The new round of talks only began on Wednesday, was adjourned after a day, and was scheduled to resume in Washington in September....
Treasury says debt sales to remain at record levels for rest of 2019
Can you connect the dots? No one in Washington seems to be willing to make the effort. On a day when the Federal Reserve said it would cut its benchmark interest rate by 25 basis points and end its efforts to sell some of the bonds in its own portfolio two months...
Fed cuts interest rates by 25 basis points; financial markets want more, more, more
Today the Federal Reserve’s Open Market Committee cut the Fed’s benchmark interest rate by 25 basis points. That’s pretty much what the financial markets had been expecting–although a sizable minority of investors and traders had been hoping...
A pause before tomorrow’s GDP report–and on worries about global growth
U.S. stocks paused as expected today ahead of tomorrow’s initial report on growth in U.S. GDP for the second quarter. Economists surveyed by Briefing.com are expecting that GDP growth dipped to 1.8% year over year in the quarter, down from 3.1% in the first...
The market dangers of this incompetent Federal Reserve
Add Thursday’s remarks by New York Fed President John Williams to those of Fed chair Jerome Powell back in December and the record shows this team at the Fed is the “Gang that Couldn’t Talk Straight.” In December Powell sent the markets...In the longer short term does the market’s intense focus on interest rate cuts from the Fed set up a trap for stocks?
Looking at what I called “the shortish short term” in a post yesterday, I said that in that time frame the market is likely to behave as if nothing much matters besides the Federal Reserve and interest rate cuts. The logic, I argued, works like this:...Jim’s Daily Email Alerts:
Every post from Jubak Picks straight to your mailbox. And they're free!