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Fed Whisperer Hilsenrath Hints: Despite Jobs Miss, Yellen Will Hike In 2015
There are two narratives, according to WSJ's Fed whisperer Jon Hilsenrath, that need to be considered when judging the Fed's next steps. First is, the economy stumbled in Q1 but everything will be awesome going forward (so we should hike rates); and a second newer narrative is the turmoil overseas which could be exaggerated by Fed actions. Hilsenrath hints today that despite the miss in jobs data, it remains above 200,000 and "suggests the U.S. economy finished the first half of the year with a solid foundation to weather turbulence from overseas," giving The Fed room to hike.
As The Wall Street Jorunal reports,
The Federal Reserve is working off of two narratives right now. Thursday’s U.S. jobs report will inform one but not the other.
The first narrative, its baseline, is built around the first half of the year. It goes like this: The economy stumbled in the first quarter, thanks to one-time shocks including bad weather, port shutdowns on the West Coast, statistical mis-measurement, a sharp drop in the price of oil and increases in the value of the dollar. As officials see it, the economy regained its footing in the second quarter, setting the stage for more robust growth in the second half of the year, continued improvement in the labor market, firming of U.S. consumer prices and at least one increase in the central bank’s short-term interest rate.
The second narrative is the spillover narrative from overseas. It is new and Fed officials are still forming their opinions about how it will play out. Greece’s default on loans from the International Monetary Fund and its referendum on accepting tough new terms from creditors create unknowns for Europe and financial markets which could disrupt the Fed’s resumption-of-growth story. A weakened euro could pinch U.S. exports and put further downward pressure on imported U.S. inflation, giving the Fed pause. Global financial strains could undermine confidence among banks and businesses, further depleting investment and growth. Stock volatility and an economic slowdown in China compound the Fed’s global worries. The worries, however, may pass. Greece’s debt default drama might well be resolved with creditors in a manner of days.
The jobs report released by the Labor Department Thursday is widely expected to confirm the resumption-of-growth narrative for the second quarter. Analysts expect the government to report that national payrolls increased in June by more than 200,000 for the 15th time in the past 16 months – the best run of that length and magnitude since the mid-1990s. The jobless rate is expected to be reported down to 5.4% from 5.5%.
If the analysts are right, it will suggest the U.S. economy finished the first half of the year with a solid foundation to weather turbulence from overseas. Fed officials will then need to spend the coming weeks assessing whether spillovers actually materialize and with how much force.
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It seems whether or not rate hikes are comin, The Fed wants uncertainty back in the "markets" - becareful what you wish for (see China).
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His job is to lie as any employed Western economist knows too well.
Realistic economic analysis is a rarity. The financial press echoes Wall Street, and Wall Street economists are paid to help sell financial instruments. Gloomy analysis is frowned upon. Even negative quarters are given a positive spin.
http://www.paulcraigroberts.org/2014/07/08/deteriorating-economic-outloo...
Read: no rate hike in our life times.
I say a paultry 25 point rate hike to show everyone that they can "raise rates"...
The behind the scenes printing has already gone exponential and exponential equations and moral hazard are a real motherfucker. Pretty soon talk of rates and eCONomics will not matter to the vast majority of the human population.
same as it ever was.
Yep, and when the year ends I'll collect another sandwich from another voice who has been eliminated from the Hedge. I'm beginning to think people need to stop wagering with me. It seems their time on the Hedge is numbered once they do.
"...payrolls increased in June by more than 200,000 for the 15th time in the past 16 months..."
One little problem:
The labor force is growing by 237,000 every month.
That means the economy needs to create at LEAST 237,000 jobs EVERY month just to tread water.
Why do you think the labor participation rate is at it lowest since 1977?
[PS: Dr., Banger already claimed they'd raise in June. I said he was wrong and offered to wager him; never got a response...]
People that say no rate hike is coming are thinking of this wrong.
The Fed will raise rates. Probably twice. From 0.25 to 0.75 and then stop and probably do another QE
In my book this is not normalizing interest rates. Sub 1% interest rates are sub 1% interest rates and still start with a 0
I say a paultry 25 point rate hike
You are taking Hilsenrath, the whore of Wall Street, far too seriously. When you use accurate inflation numbers, US has been in a recession/depression for years now.
No way can Fed raise interest rates even by 0.05% without hurting a limping economy.
What the fuck ever. Please your bets, and I'll place mine. The casino is in fact still open.
Phuck you Hilsenrath. Phucking asshole.
It's okay, you can fucking type fuck here. We don't fucking mind.
Hilsencunt is exactly the type of little weasel who deserves to get anally raped every day while rotting in prison the rest of his life.
Yea, there will be. How do I know? Because the Obama news media (particularly radio news that always, alWAYS, ALLWAYS starts off talking about our Dear Leader) keeps dropping hints that it's coming in September. The same puppeteers who run the media also run Obama. It'll probably only be a .25% raise, but they will raise.
It may turn out like this guy thinks, but raise they will;
http://redefininggod.com/nwo-schedule-of-implementation/
Can we please stop using the term "hike". Hike suggests a big move to the up side. In reality it will be barely a nudge, if anything.
Whatever
THEY MAKE IT ALL UP AS THEY GO ALONG
if they raise rates it so they can lower them again when the SHTF
The whole system is FUBAR
Like escape Velocity..... WTF
U.S. economy finished the first half of the year with a solid foundation to weather turbulence from overseas.
SOLID FOUNDATION...............................MY ARSE!
"one-time shocks including bad weather"
Bad weather is not a one off event!
Fucking liar. Mr. Yellen just sends him out to try and keep "the markets" from going even moar bulltard than they already are all the while knowing she will NEVER raise rates during her tenure.
The FED banks make 6% and they are going to give the people a 1/4%. Tell me it ain't so.
Janet Yellen be like....
http://cdn.meme.am/instances/500x/63260833.jpg
She's taking cues from her green sister:
https://www.youtube.com/watch?v=PW_02k7LRMo
They are going to raise them twice. September and November. Regardless of consequences and/or the obvious signs that doing so will negatively impact the economy.
What like 5 basis points?
HA!
Are you suggesting a type of Knot to use at the Bankster Banquet?
https://www.youtube.com/watch?v=N73VY4I0VF0
"It seems whether or not rate hikes are comin, The Fed wants uncertainty back in the "markets"".
If that really is the case, it's a pathetic aspiration and shows the bunch of Fed fuckwits running the show. Absolutely pathetic.
DavidC
When you failed so miserably as this group has you need to resort to more and more bullshit!
Failed miserably? They think they're the smartest Chosenites ever! Their brand of Communism hasn't collapsed yet because they are still able to steal our savings and our children's. All going according to the plan.
Please allow me to be the first.....Hahahhahahahahahaa....(breath)...Hahahhahahahahahaa...
SOMEWHERE OVER THE RAINBOW, YELLEN WILL HIKE RATES!
There's a land that I heard of, called a free economy!
Not in her lifetime, either.
Yeah, go ahead, raise rates and cause moar havoc throughout the world. Just what the MIC ordered.
Of course the Fed will raise rates. They have to chase the bond market eventually otherwise the whole ponzi scheme collapses. So, they are caught between a rock and a hard place essentially. Damned if they do, damned if they don't.
You know your country's a joke when an errand boy like Hilsenrat is the purveyor of policy.
Park Balloon man, and making money at it.
http://scummy.deviantart.com/art/The-Balloon-Man-92172436
If they raise rates, it is a signal that the banksters believe they cannot absorb any more wealth and power from the system, and are ready to collapse it.
Best not to be in fiat currency, or paper assets when they do.
You all need to get off this website and go out and spend more money using high interest, Cabal controlled credit cards. While you're at it grab a new set of wheels with a 7-year loan.
Hilsenpuke is not unlike the mosquito that keeps buzzing you while you're trying to sleep on a balmy hot summer night. You know that it's bite is inconsequential, but it's still a pain in the ass, nontheless.
the little prick now has a gig at Faux Business Channel, perfect match I guess
No one cares about a 1/4 point rate hike. The Fed and Obama already destroyed the Dollar and fucked the economy. Everytime I look outside my window I see the impact on the less fortunate among us.
Laugh of the day. Thanks FED.
Without a debt haircut, a rate hike will give Obozo what he wants.
More burning.
Real economic health would have seen rates raised a year ago, or longer.
With a rececssion coming eventually, Yellen literally has to blame it on something, so you get rate hike. When the recession hits, it will be QE and negative rates until the dollar dies.
If the stock market is indeed proxy for positive public sentiment (and perhaps even preservation of societal order, given the hair-trigger-ish nature of late), the Fed is ~hoping~ for an airtight excuse NOT to raise rates. And they may be supplied it from an unlikely source: Geopolitics. The kind that fall outside the purview and immediate control of internal Fed $levers. I'd suggest that scenario is playing out right now, quite swimmingly in Greece, Syria, the South China Sea, the Baltic Sea, Mariupol and Kiev. Perhaps even Saudi Arabia as well.
pro tip: massive amounts of bullshit are NOT a "solid foundation to weather turbulence"...
it just guarentees that everyone will get splattered when the turbulence hits.
The one thing I am 100% confident about in this market - the only thing - is that there will be no rate hike. Not this year not next year not the year after, as long as the current Federal Reserve regime is in existence. Only when it gets bad enough that those assholes are run out of town and a new currency regime is in place will we see anything like normal interest rates ever again.
THE FACT: QE NEVER ENDED.
Think of one single world central bank embracing FED, BOE, ECB, JAPAN, CHINA etc.,etc.,
Calculate total, all that money that was printed and debt that was created since 2008. The global QE is skyrocketing and there is no stopping it by those psychotic oligarchs.
Raising rates of .25 point is a propaganda ploy to repatriate capital to US so it could be borrowed by US government and in the same time weaken all other currencies in addition to printing itself.
The economic recovery talk is a BIG LIE. There is only bubble blowing.
Bubblology 101;
Bubbles are credit expansion/contraction, government policy driven monetary intervention cycles well described in "Money Masters" which now are completely divorced from economic cycle, which is stuck in US in core industrial depression levels over thirty years now.
In other words boom and bust cycles are only fueled now through credit policy into specific market tradable assets selected and ordered by policy makers.
The world central banking system is trying to moderate bubbles’ deflation or collapses through creation bubbles in another asset class just to maintain values of collateral from the initial bubbles.
For example if you overpaid for your house and prices are falling and you cannot sell without massive loss, windfall from another bubble is able to cover your mortgage, losses and/or margin requirements, so you hope and wait for better times.
And so you go from one bubble to another and this relates all abstract paper assets and derivatives including, debt, oil and gold etc. Hence, crash may occur only when CBs run out of bubbly and no more bubbles could be created otherwise party will go on while more and more weaker rats in this rat race are being eliminated via attrition and slide into socio-economic margins like most of us even if we do not know it yet, we are next.
Such practice, in essence denying basic tenet of capitalism namely capital re-production and recycling into productive assets, which is in the first place is labor, was and is widely implemented over last 30 years by world ruling elites and now even in China rendering population obsolete in grand scheme of illustrious progress of civilization.
The real economy is dead so its real economic cycle that included revolving commodity and labor investment assets, recycled in and out economy a classical capitalistic re-production cycle.
This type of process is dead and buried. There is no revitalization of labor power as well as commodity demand due to collapse of labor income and collapse of asset or commodities prices controlled by vast majority of population subjected to deadly deflation spiral due to removal of money from circulation among ordinary people a devastating process, getting stronger and more intense as bubbles become bigger and more numerous.
The only thing that maintain mediocre demand and keeps us from massive unrest, hunger and ultimately further pauperization now is ever shrinking money supply from government social programs such pensions, SS, social welfare, technical/scientific funding, military or security/police non-productive funding which ironically fuel spiral of public and private debt needed to keep it bubbles blowing in the first place.
It’s like on Titanic, party was going on as usual while in lower decks people were slowly drowning. I hope that there would be not enough boats for all those murderous and gluttonous oligarchs when one day water reaches their noses.
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https://contrarianopinion.wordpress.com/2015/01/28/liquidity-of-blood-sw...
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https://contrarianopinion.wordpress.com/2015/01/29/invisible-hand-and-ot...
For instant labor and unemployment 101 class see:
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For instant socio-economic origin and function of money 101 class see:
https://contrarianopinion.wordpress.com/2015/04/14/plutus-and-the-myth-o...
Just to put a 1/4 percent increase in perspective:
The U.S national debt is, currently: $18,155,179,118,126.
.0025 of that represents additional payments of ~ $45,386,947,795
--and that's just with respect to US Treasuries...
That the Federal Reserve would seriously consider such a move could only be ascribed to the effect a massive inhalation of nitrous oxide.
Two points;
1) if that $45 billion is simply staying within the Fed/treasury circle jerk, so what? The rate could only apply to new issuance.
2) What is $45 billion in a world that has seen QE of 80 billion per month?
Get long sharecropping, black markets, and guillotines, beat the rush as the event horizan was passed a long long time ago.