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The Fed Is Scared To Raise Rates, Ron Paul Warns "Everything Is Too Vulnerable"
Submitted by Mac Slavo via SHTFPlan.com,
The system is teetering on edge, and nearly everyone in the financial sector is waiting for one decision – will the Fed finally raise rates?
Ron Paul has made a bold prediction that the Federal Reserve likely will NOT raise interest rates, something which would have enormous consequences in the market, because it is hesitant to do so with so many negative risk factors the market already faces.
Fed Chair Janet Yellen – and most in the financial sector – know how much is impinging upon the possible decision to raise rates after years and years of quantitative easing have pushed the limits of stimulating the economy. According to CNBC:
By Paul’s reasoning, the Fed is too scared to raise interest rates in the middle of an already weak recovery and risk sending the U.S. economy back into recession, or worse… The Fed chief “does not want to be responsible for the depression that I think we’ve been in the midst of all along,” Paul added. “Everything is vulnerable, so we’re living in very dangerous times,” Paul added.
The banks have basically become junkies to constant cheap money, and QE3 has gone so far over the edge and upside down that pensions, insurance policies and savers can no longer earn future value through basic investment.
But according to the former Congressman and presidential candidate, big trouble in China, or our own potential economic breakdown, may be enough to call off action by the Fed because bigger problems may prevail.
Ron Paul told CNBC:
She’s going to be more hesitant to raise rates because she sees how fragile the global economy is… I could be wrong, but I don’t think they are going to raise interest rates.”
“I think there’s going to be enough problems existing, whether it’s the Chinese precipitating some crisis, or whether it’s our economy breaking down,” he said.
Does this count as yet another prominent warning by experts that the U.S. economy is headed for another crash, and perhaps even a prolonged collapse?
The Chinese problems are having a huge impact in America right now, with so much reliance upon China for global trade. Now that instability has hit, it is putting significant pressure on the faults and weaknesses of Wall Street and the rest of the U.S.
Ron Paul, a very learned critic of the financial system, is outright suggesting that the central banks are no longer in control.
Right now, the Fed isn’t sure if it can back off from artificially stimulating the economy, because it is making the biggest moves out there.
Simultaneously, it doesn’t know how to maneuver away from that position without rocking the boat enough to create a tidal wave that is certainly going to hurt for someone.
If a Fed rate hike did occur in September, as many reports have suggested, it would be the first increase in nearly a decade – enough to keep the experts up late at night, crunching numbers, to see how bad it could get.
I could save them all a lot of time and sum it up – it could obviously get pretty bad. Can crisis be averted?
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charging into the fray its captain obvious
No shit. It's been obvious for years that the Fed can't raise rates, but I think his point is valid, we're at historic levels of vulnerability.
with all props to Dr. Ron...
We've known this for years.
It's the 95% of the sheeple with their heads shoved shoulder deep up Kim Kardashitard's big fat fucking ass who don't know what the fuck is going on.
And those fuck-tards sure as hell don't read Zero Hedge.
Stack guns and ammo along with phyzz, and other essential gear, bitchez.
Cuz thos 95%'ers are the reality of what zombie movies are all about.
Kardashizombies is what they should be called.
I don't hate them...they're just a product of the dumbing down of America. They don't realize how ignorant and clueless they are.
But they will never understand it no matter how this all turns out. They will still be turned against the few of us who prepared for what we saw was coming.
Then it's on like Donkey Kong, bitchez.
Frankly I don't think they're scared. They may pretend to be but they will take a the crisis that results and gain more power for the government and banks by banning cash and pushing rates negitive. Never let a good crisis go to waste after all. Those who are in the know, and get the wink wink and nod, like Goldman and HSBC, who just bought 7.2 tons of PHYSICAL gold will do just fine.
You might ask why HSBC, the custodians of GLD, from which you can allegedly take physical delivery when over a million dollars, would need to buy physical gold through the COMEX? Well that is a good question.
Just when the Fuck can we all get some interest on our fucking money
Fuck!
Can crisis be averted?
NO!
It's too bad that Dr. Paul was too old to become president of the US 7 years ago.
Interest rates can't be hiked at this time. Could you imagine the price for oil if interest rates were 6 percent. We'd be looking at 10 dollars a barrel. Deflation, deflation, deflation. Learn it, live it, love it.
"Right now, the Fed isn’t sure if it can back off from artificially stimulating the economy, because it is making the biggest moves out there."
I believe the Fed is completely sure....they pretend like they are considering a move to convince the sheeple that it is actually an option when it's a total bluff...then when the moment comes, they will come up with one more excuse why they are "delaying" the ultimate decision. lol. Sort of like the dude that keeps telling his live in girlfriend that he's waiting for the right moment to propose, knowing there's not a chance.
And furthermore...
END THE FUCKING FED!!!
It's a criminal privately owned mafia cartel and is NOT Federal. The IRS is nothing but a violently criminal private enforcement agency used to intimidate and harass the U.S. citizens!!!!!!!
Fuck...we all know it...just keep spreading the word.
I can't tell you how many people to this day I still wake up to this fact. And they still don't get it right away, as if they're waking up from a foggy fucking dream and you have to slap them around a couple dozen times to get them to wake the fuck up and understand it.
It's fucking amazing.
“It's easier to fool people than to convince them that they have been fooled.”~ Twain
great twain quote
That fact about the IRS is why everytime a candidate for president says they will change/fix the tax code, I know they are full of shit and probably just a puppet.
i'm concerned now,
how do you kill a Kardashizombie?
shoot it in the ass where the brains are?
wear a facemask, the silicone backspray tastes nasty
One of the reasons so many of know this and have known this is because Ron Paul and others have been educating us since at least 2008.
I beez with u dawg. 1000 up
The Fed and banksters have bought trillions in bonds
raising the rates will crash their books
why would they want to do that?
You assume they aren't keystone cops flailing around like fish. Wonder if they are flipping through their textbooks trying to figure this out? I wonder if they even realize this would hurt bonds or what it would do to interst rate based derivatives? I remember BB saying all is well last time summer of 2008....wondering if he was just putting on a happy face or are they really that clueless.
but...they bought it with counterfeited journal entries. It's not like they burned any of their 'savings' on it. So, they'll just by trillions more....but when the .gov pays them back with INTEREST, the interest is real dollars. So..the way I see it, they're new scam would pay a higher return on their counterfeited JE.
End the Fed! Love Ron Paul.... He helped wake me up several years ago. Again there is only one candidate who is anti-fed. And his initials are RP.
We need to show the establishment that Rands campaign is not failing and will be in it for the long run. That's why I'm donating half of every sale of my candles with silver coins (https://www.etsy.com/shop/ScentSavers?ref=hdr_shop_menu) to Rands oneybomb on September 7th. Just put in the buyers notes what you think of the federal reserve to make your sale a special sale to support Rands campaign. Any sale with a special buyer note now through September 7th will qualify, if it has the buyer note!
End the Fed!
I participated in all of Ron paul's money bombs - won't do so with rand unless he makes a definite and clear move to revoke his pro-Zionist, anti-iran positions. Sheldon Adelson will never give him any money -if he did - I want nothing to do with Rand.
Rand said he would end all foreign aid including to Isreal in the last debate. That's pretty much the most non-zionist that you will get.
Real Money, Rand said not a penny more, that's about as clear as you can get. I'll support Rand just as I supported Ron. It's too bad we don't have anyone else running that wants to end the fed, good luck with your candles I think that's a great way to spread the word of real money.
"By Paul’s reasoning, the Fed is too scared to raise interest rates in the middle of an already weak recovery and risk sending the U.S. economy back into recession, or worse… The Fed chief “does not want to be responsible for the depression that I think we’ve been in the midst of all along,” Paul added."
Most important sentence of that passage is:
"The Fed chief does not want to be responsible for the DEPRESSION that I think we've been in the midst of all along."
Ben Bernanke - "No rate normalization during my lifetime"
I pity the fool long stocks if she raises rates. I usually buy the SPY right before she speaks and the market goes up when she says no hike....as they cheer easy money. Usually in for not more than 30 minutes. I'm getting scared she might be just fool enough to do it and might sit this one out.
If she does EMs probably go down first then it works its way here. CNBC cheerleaders sit around scratching their heads wondering what happened and panic to find a guest to explain it. Or they just blame it on the minute amount of snow left on pikes peak.
Everything ia awesome, and fuck these shits. Pour your money into the market and feast on their deseerts.
The only thing my money is going into is silver and gold, the physical stuff.
What if the Oligarchy decided that now for whatever reason was time for some fireworks to happen? Then they would raise rates.
Remember the Fed acts on the orders from it's masters, not for some kind of common good.
If the rates are raised now, it is the beginning of a deliberately controlled implosion. It would be just too destructive to not be considered deliberate.
I think it would make more sense to extend this as long as possible, more jawboning about "soft growth", and more QE probably with China as the excuse.
I don't really know honestly. They're not being straightforward about what they're going to do. So I'm left to guess like an out of the loop peasant.
I think they just continue their 5 years of just trying to talk up rates. "We will raise in a few months"...HA. And it appears people tend to actually buy into it. Data doesn't support it in any way. Dollar would go up, hurt home and auto sales, and lord knows what it would do to the interest rate based derivatives and bond market. I don't think people realize how destructive a 25 basis point raise would be in our economic status.
This whole the fed is gonna raise rates narrative has been hilarious.
These clowns are not raising rates until the markets force it, and by that time there will be bigger problems.
The amount of people ive seen coming out saying september october rate hike who should know better and falling on their swords over this has been sad to say the least.
Yellen's jawboning on this has always been "data dependent" and the data stinks.
If they just go ahead and do it anyway though, there will be fireworks, i hope people are prepared just incase :)
but this time they mean it
But this time it's different.
Ya know, I "rolled over" in bed the other night and gave myself a huge bump on the head.
The fed IS NOT going to raise rates.
A California bed time love story:
A guy was lying in bed with his new girlfirend after some sooper dooper great sex and for the next hour she was gently rubbing his nuts. Which he loved. So he askes her why she likes rubbing his nuts.
To which she replied; "Because I miss mine so much."
;-)
I don't know if Bernanke panicked or did it on purpose but the end result will be the same. Sleeping with a 20 trillion dollar tranny hooker and only paying .25% brings Bubba (formerly known as Daisy) into the picture...lol.
well if they do raise rates then china could move all their usd into a money market and get that sweet, sweet, 0.50%. woohoo!
Kinda fucked ain't they?
S/He who raises rates first risks being tagged as the person who causes the next Depression. That's all you need to know about the long-term options for recovery.
The fed doesn't need to raise rates. The "strong dollar" is doing the job for them. As far as rates go they may do a token raise then a wait and see to save face, but we will never see fed funds above 1% again.
All Ponzi schemes come to an end, eventually, and the FED has a whopper on their hands.
If a .25% increase in an interest rate causes a depression, it proves you have been in one all along.
The FED won't let the shit show self destruct while the Commie in chief is in office.
As soon as he is out they will make sure the bottom falls out.
rates won't be raised. But how long can the markets go up with zero interest rates? This can't go on forever -without setious inflation -can it?
It's like a swim instructor telling his student that he can swim, but he's too afraid to take the floaties off and discover the truth.
The truth is that we've been in Fed-induced coma for the last 15 years. Whether Yellen willingly raises rates or the bond market forces her hand, this whole Ponzi scheme unravels.
Time to end the FED.
Guillotine the Fed. Audit the heads.
Liberty is a demand. Tyranny is submission.
The FED cannot raise rates and must continue to dance on the head of a pin until the whole thing flies apart like a transport truck retread on the highway. I agree with Dr. Paul that a rate raise is unlikely.
Oh, what will the grifting and plundering thieves do:
Raise rates as part of an engineered collapse of the dollar so as to further profit from it and the resulting misery?
Allow the dollar to collapse on its own without a plan to further profit from it and the resulting misery?
You can call a friend if you need.
Liberty is a demand. Tyranny is submission.
"By Paul’s reasoning, the Fed is too scared to raise interest rates in the middle of an already weak recovery and risk sending the U.S. economy back into recession, or worse… The Fed chief “does not want to be responsible for the depression that I think we’ve been in the midst of all along,” Paul added. “Everything is vulnerable, so we’re living in very dangerous times,” Paul added."
Attributing humanity to a cabal of psychopathic grifters and thieves is a mistake.
Liberty is a demand. Tyranny is submission.
Why is it that you say the things I want to say but you do a better job of it, and even make it shorter than if I wrote it??? Go away!! :-)
Don't worry about me, or any one else, just keep screaming it from the rafters, and pounding it into to the marrow of their lies.
Liberty is a demand. Tyranny is submission.
I recommend that all that are serious about understanding, and/or countering, tyranny's lies and propaganda read Propaganda by THE Zionist master and originator of propaganda in the west, Bernays.
Ron Paul is nearly a saint. He got this story straight MANY YEARS ago and sticks to the path of truth.
Gee Ron... No shit!!!
Do ya think you can coach "The Donald" in the finer points of your analysis including writing him some speeches?...
I'd also like Don to look into the reinvestigation of 9/11 especially an appeal on Judge Hellerstein's decision that WB7 came tumbling down 8 hours after Tower(s) 1 and 2 because it wasn't "built well enough"as a campaign promise!
Hey Jessie coach your soon to be running mate on the finer points of what he's been ignoring for the past 14 years with his real estate pal Larry Silverstein 'nod", "nod", "wink" "wink..." down the street from him!
last words, "...tied to geopolitical events, too"
WELL, NO SHITSKI
LIKE HOW PUTIN INVADING GEORGIA IN AUGUST 2008 TIPPED A RUN FOR THE EXIT DOORS IN ALL THAT JICKY REAL ESTATE PAPER??
Thanks for the buy signal Ron
I'm sure they've run simulations involving different scenarios testing they algos to see if they can catch and ramp the "market" as they obviously been doing.
They'll raise and you just watch how sedate the "markets" are. I wouldn't be surprised if they continued there upward trend!
Then they'll release a statement on how well they handled the crisis and everything's going to plan.
Can anyone explain how it is even an option to raise rates appreciably? Won't all the sovereign debt need to be refinanced at a higher rate each week when the Treasury auctions off bills, notes, and bonds...and we're already paying roughly 25% of tax revenue in interest?
Winner. People seem to ignore this obvious fact.
Pretty much...but let's not spoil Obama's Green Legacy and Lightworking Magic Car Show party just yet.
The guests are still arriving! ;-)
That's not the Fed's concern; Congress will simply authorize more debt (that the Fed may have to soak up via Treasury-issued new debt) to cover that expense. I mean, what is a mere $50 billion to them anyway (with a nearly $20 trillion hole already)?
The Fed is (or damned sure ought to be) concerned with...credibility.
Either they actually sell even a tepid "recovery" with a rate rise, or else, they can NOT spin that anymore. I believe they know this very, very accutely.
It's all about maintaining confidence in their control. They don't raise rates...they will lose that. They couldn't give a shit about additional debt service costs.
It always rode on what they could sell; NOT on what actually is.
They created this corner to stave off the 40-year disaster shortsighted outsourcing orginally caused. That corner has been steadily closing in on them, and they realize it's now all on the line. Credibility is all that matters.
If they DON'T go...it will soon go up anyway. They really have very little to lose in trying at this late stage.
The consequences for NOT going is the REAL risk now.
m
QEinfinity
The more I read " They won't raise rates " the more I say hmm everyone is on a one sided trade, what a perfect setup to crush everyone of you in an instant.
And a fine excuse for a 30% correction of sorts...
Does anyone even know what .25% of twenty trillion looks like?
(Gasp!)...lol.
Well 25% of $20 Trillion is $5 Trillion.
So .25% would be $50 Billion.
$50 Billion Annually for each .25% raise in FED Rate.
Effective Federal Funds Rate
2015-07: 0.13 Percent (LIRP)
Monthly, Not Seasonally Adjusted, FEDFUNDS, Updated: 2015-08-06
https://research.stlouisfed.org/fred2/series/FEDFUNDS/
Total--Interest on the Public Debt, under Treasury, 2014 = $429.57 Billion
Total--Interest on the Public Debt, under Treasury, 2013 = $415.7 Billion
Total--Interest on the Public Debt, under Treasury, 2000 = $362.1 Billion
Total--Interest on the Public Debt, under Treasury, 1998 = $363.8 Billion
Total-Federal Government Actual Budget 2014 = $3.5 Trillion (B. Obama)
Total-Federal Government Actual Budget 2012 = $3.54 Trillion (B. Obama)
Total-Federal Government Actual Budget 2010 = $3.45 Trillion (B. Obama)
Total-Federal Government Actual Budget 2008 = $2.98 Trillion (G.W. Bush)
Total-Federal Government Actual Budget 2006 = $2.65 Trillion (G.W. Bush)
Total-Federal Government Actual Budget 2004 = $2.29 Trillion (G.W. Bush)
Total-Federal Government Actual Budget 2002 = $2.01 Trillion (B. Clinton)
Total-Federal Government Actual Budget 2000 = $1.79 Trillion (B. Clinton)
Total-Federal Government Actual Budget 1998 = $1.65 Trillion (B. Clinton)
Total-Federal Government Actual Budget 1997 = $1.6 Trillion (B. Clinton)
Federal Debt: Total Public Debt
2015:Q1: 18,152,056 Millions of Dollars (Flat Lined sine 4th QTR 2014!!!!!!!!!)
Quarterly, End of Period, Not Seasonally Adjusted, GFDEBTN,
Exactly, reform pressures trigger Sovereign bond crisis... like in early 20th Century.
Martin Armstrong rightly points this out.
What we don't know is if the hard ball is nuclear.
They want Global Monopolies... but will they crush consumption and the middle class even more than crushing wages????? Sure total banks have been crushed to 5,000.
Sure Farms have been crushed for 100 years.
Sure Mergers and Acquisitions accelerated in the 80s and again in the 2000s.
Will the partners of war bring total destruction and destroy the debt based US Economy???
Painted in a corner with invisible ink...
Just like the ECB That waited too long to kick the can this summer on Greece with the end results being the final economic destruction of the latter, the Fed at this moment is facing having to open the two damnation doors, damnation on either one they choose. if they hike the markets will correct and then some and if they hold the markets will go parabolic same as NASDAQ Y2K , the German DAX and the Chinese Shanghai earlier this year. to collapse and then some.
Have your shorting strategies ready and hedge accordingly.
There's NOTHING "bold" about saying the Fed won't raise rates! HELL NO THE FED WON'T RAISE RATES - EVER!! They have their heads stuck so far up their asses they can't even see the light of day.
If the lowest Federal Rate was 5%, then we would see minimum of $1 Trillion in Federal Interest a year... probably $1.4 Trillion a year minimum.
When will the Banks lower the boom on us.
When we put pressure on TBTF Wall Street Banks to clean up their Accounting, Auditing, and Financing... they will go after the Federal Govt after they go after the big Municipalities and States with poor Debt Structure or Budget Practices.
Simple, you ask for tight banking, you want reform... Boom, we put it back on you, the government, the states, the cities.
Greece, PIIGS, Porto Rico, Detroit, Chicago, California, ....
It's howdy doody time.
Let's support, enable, and condone our US/UK/EU Leadership for the Poor Stewardship of the USD, the World Reserve Currency.
And while we are at it in the USA let's Enable the Steward Ship of our Kids, our future, and all our so called official Agencies not just the FED, but also TBTF, Self Regulatory Banks, and DOJ, FBI, SEC, FINRA, FTC, GAO, CBO, FED, Treasury, OCC, FSOC, BCFP, CFTC, FDIC, FHFA, SIPC.
These guys do great for us.
Like Loretta Lynch.
I mean the USA/UK/EU have no War Criminals, have never destabilized entire regions of the M.E.
$T Debt Added
J. Carter, ,$0.37 T (4 yrs)
R. Reagan, $1.69 T
G. H Bush, $1.4 T (4 yrs)
W. Clinton, $1.627 T
G. W. Bush, $4.357 T
B. Obama, $6.365 T (4 yrs)
B. Obama, $8 T (6 yrs est.)
But none of these guys takes responsibility for anything not in their In-Box:
Treasury, Jack Lew
SEC, Mary Jo White
CFTC, Timothy Massad
Fed, Janet Yellen
OCC, Thomas J. Curry
CFPB, Richard Cordray
FDIC, Martin Gruenberg
FHFA, Mel Watt
NCUA, Debbie Matz
Insurance, S. Roy Woodall, Jr.
And who else is in DOJ & FBI that probably has kids with a stake in the Future of the USA & $1 Trillion Dollar payments to TBTF Banks for US Federal Debt, the Impact from Fraud on Wall Street, and the loss of US Consumption/Middle Class with loss of US Federal Tax Revenue.
Alicia Anne Garrido Limtiaco, Guam.
Bill Nettles, District of South Carolina
Preet Bharara, New York State
Kelly T. Currie, New York State
Deirdre M. Daly, Connecticut
Zachary T. Fardon, Illinois
James A. Lewis, Illinois
But I guess I need the names of the Heads of Financial Crimes.
Robert J. Holley, Chicago SAIC
Diego Rodriguez, NYC ADIC
And what are the FBI Heads names...
Director – James B. Comey
Deputy Director – Mark F. Giuliano
Associate Deputy Director – Kevin L. Perkins
Chief of Staff/Senior Counselor – Jim Rybicki
Kind of hard to find who is the Financial Crimes Director.
- Which is weird since 2008 was a Global Financial Crisis caused by Wall Street Fraud
I guess we have to look to the chief of Cyber Crime since most finance is Wire Fraud.
Criminal, Cyber, Response, and Services Branch
- Executive Assistant Director – Robert Anderson, Jr.
Hey it is only Economics, guys. Didn't they teach you guys in the Ivy League about Economics and Budgeting???!!
The rates will go up in Sept, or Dec, or March 2016, or June, or Sept, Dec, NO WAIT REALLY AND TRULY, cross my heart and hope to die, It will be 2017 March, or June …… JOHNLGALT
IF Trump picked Paul as his running mate we'd have a
TRUMP-ALL -!!!!! TICKET
The Fed had a chance after the so-so QE2 to raise rates. We would have survived a healthy 20% correction after the big run-up and have a better economy today. I do not see the United States coming out of the much larger collapse that is now inevitable because of the Fed.
Quiet night on ZH.
Soooo Alessio Rastani was out-front and was correct as a Trader who know where the big money is.
If you listen to anyone you need help from insiders and to get reform you need insiders to concur,,,
http://www.zerohedge.com/news/bbc-speechless-trader-tells-truth-collapse...
How else could anarchy, or democracy, or republicanism prevail???
We need friends and insiders who are powerful if only for the knowledge, history, orientation, and evidence against the guilty.
QE will turn into NIRP. Why? See below. Let's bring back the solar era and tax everyone to death by collapsing the Roman fiat exchange with the current USD currency reserve Global Status.
Joseph tainter; The Collapse of complex Civilisations - YouTube
There's no two ways about it.
QUIT IT1
Everybody knows they are only pretending they might rase rates.
It is one of the Fed's way of saying things are better than they really are.
NO MORE DISCUSSIONS ABOUT RAISING RATES.
I'M SERIOUS.
you know damn well they raise rates the moment we try to correct it significantly. if the donald wanted to end the fed or something, then they'd simply crash it the moment he takes office.
Oh don't be silly.
A false flag war, ending all political threats to central banks, can be started in less than five (5) minutes.
Simultaneously, it doesn’t know how to maneuver away from that position without rocking the boat enough to create a tidal wave that is certainly going to hurt for someone."
For a long time, I've said the Fed couldn't do this or that, without setting the whole thing off. In fact, I didn't think it could end it's bond buying (and many claim it still hasn't...really) without tanking the Wall Street racket, only to then be faced with about-facing to start the bond buying all over again...
Yet, they did, and it didn't. Unless EM's or the Belgium behind-the-back thing actually DID take up the slack, it would seem they got away with that one. Of course, ZIRP rolled on, and THAT seems to be the raw meat the rackets (stocks, shacks, autos, ect.) are feeding on anyway.
And THAT'S the rub, I think, here. ZIRP for most of a decade has become a major drug habit for those rackets, and in the face of a mostly dead economy, it's about all that keeps the corpse twitching. It's that "twitching" that the Fed (and others) have been calling "a steady, if slowly, improving economy". Average Americans know the truth, and their discretionary spending in what used to be a 70% consumer spending-driven economy reflects this. Now, either the Fed is more right, or average Joes/Janes are. A major moment of truth, that cannot be avoided anymore, rapidly approaches...
Unless a major disturbance or disaster of some kind strikes, I believe the Fed MUST raise rates, regardless of any risks. Whatever credibility they might have left will be seriously questioned if they do not raise rates THIS year. They simply have no choice. It can't be a meaningless number (less than a 1/4%) either. A number smaller than that minimum would amount to no real confidence in their economic progress claims.
Either the Fed actually believes we are in some kind of recovery or it doesn't. If it can't raise rates to even 25bps by now, confidence in it's claims will deteriorate into collapse. I believe it is much more terrified of this eventuality than anything else. The Fed manages the stuff that makes it go. If they are unable to exude any further confidence in being able to do this (even delusionally), I think they fully understand the wheels would come off.
Of course, IF it DOES raise rates...what happens next will be a real coin flip.
If the rackets implode, it will likely have to wind it all back, and maybe even add more to the new mix.
Their credibility would then be shot to hell too, and it really goes up in flames.
If they can get 25bps to stick without disaster, my guess is they'll stay there for a very long time. They'd dare not risk more.
The next several months are going to be a period for the ages, I think...
m
You make a good argument.
The Fed, with it's impressive sleight of hand (since 2009), now has the approval of the banks, the central bankers of the 1st world, the media and practically all Americans who have skin in the game.
What are the risks that they won't be able to print their way out of?
Maybe the long delay of raising wasn't because the economy was flimsy, but because the banks needed a little more time to fleece their depositors?
Anyway, good on you.
They will raise rates a bit along with MASSIVE printing to cover any losses. All in the theme of the recovering economy. How they do it, now that is the question.
I don't recall the Fed having any trouble in lowering rates for 7+ years...so a small adjustment is needed upward..sometimes it is so hard to get it up when you have been dormant for 7 years..:)