This page has been archived and commenting is disabled.
10 Reasons Why The Fed Won't Raise Interest Rates
Submitted by @RampCapitalLLC via 330Ramp.com,
1. China Hard Landing - Last week China decided to devalue their currency which brings into question the strength of the global economy.
2. Football - With football season kicking off, there are a lot of Fantasy Football lineups to be filled out. Paying attention to the draft is much more important than a 0.25% rise in short term interest rates.
3. Off The Highs - The market has been range bound almost the entire year. The S&P 500 recently had a couple of brief scares below 2100 but Janet (Yellen) is looking for 2150-2200 before a rate hike can even be put on the table (Update: $SPY just went below 200DMA). The US equity market is currently in the 3rd longest bull market ever. Janet will not settle for anything less than gold (which is now also worthless).
4. The Plague - With a couple of cases of people catching The Plague in California and Colorado, Janet doesn't want to further sicken the market by raising interest rates. See last year's Ebola scare.
5. Commodities and Inflation - Prices of most commodities have been hammered the past few years (still waiting to see this tax cut passed on to the consumer). This weakening of commodity pricing could be bad news if it is a sign that global demand is also weakening. The Fed has also been keeping their eye on inflation (deflation), but we haven't hit the magic 2% inflation target since 2012.
6. Donald Trump - With Donald Trump leading the polls and dominating the news, this gives Janet the perfect distraction to kick the can until after the 2016 election. An even better distraction would be for Janet to announce her plans to run for President. I'd vote for her, but only if she agrees to nominate me as Treasury Secretary.
7. IMF Warning - Back in June, the International Monetary Fund (IMF) warned about potential risks of a Fed tightening. At this point, the Fed's only job is to fall in line and listen to what the IMF says. If they can "fix" Greece, I'd swallow my pride and listen to them too.
8. Addiction - We are addicted to free money (and fast food). Once an addict, always an addict. From the federalreserve.gov website: "Low interest rates help households and businesses finance new spending and help support the prices of many other assets, such as stocks and houses." Key emphasis on stocks.
9. Labor Market - The Fed won't raise rates because we haven't hit our full unemployment (moving) target.
10. The Ghost of 1937 - I know it sounds super scary. Anyways, about 80 years ago the Fed tried to pull off an unsuccessful rate hike after the Great Depression causing another recession and a 50% market decline. Good enough for me. If it happened 80 years ago it MUST be exactly the same today because nothing has changed since then.
* * *
Bonus: In case I'm wrong and the Fed does raise rates at least we know they can always lower them again when things turn to shit.
»
- 30391 reads
- Printer-friendly version
- Send to friend
- advertisements -
11. fear of social instability in countries dependent on oil revenues which are already upside-down from the move from $110 down to 40.60 --- a rising interest rate environment right now would send it down the next leg of its elevator shaft trip & blow-up even further for longer the budgets of such countries.
End the Fed. We need to understand that the Fed is the source of most of our problems. Support the Rand Paul moneybomb on September 7th. He is the only candidate with the track record of opposing the Fed and their schemes.
I'm selling candles with silver coin prizes: https://www.etsy.com/shop/ScentSavers?ref=hdr_shop_menu
I include a flyer on the Fed to help raise awareness. Half of every sale now through the 7th will go to the September 7th Rand Paul moneybomb!
End the Fed...nuff said
Come on the Fed has no problem with causing asset prices to go down, how else would the member banks and insiders be able to buy them at rock bottom prices before they pull some new policy tool out of a hat just when the time is right to goose the markets.
GIS of "Ghost of 1937" returns this as the very first image:
http://fm.cnbc.com/applications/cnbc.com/resources/img/editorial/2015/02/24/102451249-RTR4QZ8A.530x298.jpg?v=1436902358
[Funney, I didn't think she was that old...]
You CAN'T raise rates when you are stareing at a gvt default in your face.
But you must raise rates when you're staring 'lil Jimmy in the face as he has a gun to your fucking head because he's pissed off that his fixed income grandma has to eat Alpo Souffle for dinner.
The Fed is in a no win situation here. It must raise rates. It cannot raise rates.
At the moment, Jimmy is focused on Kelvin Benjamin's ADP.
Panem et Circenses will not last forever. It didn't in Rome.
We're headed for a Zimbawe style collapse. Look, the Fed, the banksters and Wall Street have been living in this make-believe lala land thanks to QE. They know it's wrong, they know it's immoral, (not that they fucking care, but they know), and they know that it cannot last, but it can last for now. And that is all they care about. Until the end of this quarter. Until the end of the next. Or maybe the one after. Party on, Wayne.
These sockcuckers don't give a rat's pitoot about what happens tomorrow. Once you wrap your brain around that then you understand that they will let the band play on on the steerage deck until the mothertrucker sinks in all of its furious glory.
What's the old adage?
Prepare accoordingly. Protect assets, hold real money. Minimize exposure. Stock the bar. Make popcorn.
... Unless the time has come to crash everything in order to further the CFR Globalist aganda...
Yep, this bee-yatch is going DOWN, at a time of THEIR choosing. Which, if you are privy to TRIBE secrets, will probably be sometime bt. 9/11 and 10/12. Prepare accordingly; everything you see in stores today is on super-duper sale. GET IT NOW!!
They're not even close, this show could go on for years. Why would we fold first? They can still borrow Trillions of FRNs and hand us the bill. When we are last man standing, the credit line is maxed out and the barbarians are at the gates, then the crash it and run away with all the loot.
But your timeline is less than a month away, so lets see.
Who knows, you could have called it.
Million Dollar Bonus...... Is That You
Snark or reality, you be the judge......
11. Because they're all full of shit.
I came here for the thumbnail of Yellen being shot into the air on a lawn chair.
Me Too! Popcorned!
Stay for the pictures of her as the "Ghost of 1937"
I hate being teased!
But I like most humor...this made me chuckle -
"9. Labor Market - The Fed won't raise rates because we haven't hit our full unemployment (moving) target."
Bwuuuhaahaaa!
Yes, a few of us still have full-time permanent work.
There's room for improvement there, lets shoot for zero % (employed).
12. The button they use to raise rates has rusted shut.
I don't have time to comment....gotta get back to my fantasy football rankings...
Record the latest kardashian sighting from TMZ while your at it for me please, i'll come pick it up when i get back from Walmart getting a 199$ flatscreen on credit. Thanks!
I just ordered a new smartphone off Amazon Prime.
Nothing you could say will bring me down off this cloud.
Everything I will ever need is that phone.
There are many like it, but this one is mine.
It's all political.
They want you barefoot and pregnant as long as possible.
LOL.
They cannot steal if you're watching them.
I'm getting a little burned out at politics lately.
Tough shit - we have 16 months until the next presidental election, so just man up and get ready to vote for me.
Central planners and statists the world over should be so proud of the absolute monstrous shit-storm they've created.
CAUSE THEYRE FULL OF MOTHER FUCKIN SHIT - THAT'S WHY!!!!!!!!!!!!!!
it's hammer time
https://www.youtube.com/watch?v=otCpCn0l4Wo
If one images the FedRes as an independent and autonomous criminal organization, then it is easy to imagine them not raising rates.
If one understands that they are just one part of a much larger criminal organization, then it is easy to imagine them raising rates, and the rest of the cabal profiting from the fallout.
The FedRes is just one cog in Zion's plunder scheme, and so they will raise rates.
Zion is a scheme, not an ethnicity.
How many municipalities and states are dead broke in the land of the free? Federal debt and unfunded liabilities exceed $210 trillion. Student debt is well north of a $1.2 trillion. Car loans are beginning to default at an alarming rate. Pension funds are underfunded by trillions. Home ownership and labor participation rates keep falling. The good news is never ending. So we do not need the additional good news of a rate hike.
I think the great Bill Paxton described this well:
That's it man, it's game over man, game over!
https://www.youtube.com/watch?v=dsx2vdn7gpY
Looking ahead, his "Why don't you put her in charge?" line is the scary bit.
In my head I hear that sinister laugh from Vincent Price like in Michael Jackson's Thriller video.
So just BTFD already.
talking about unfunded liabilities is like talking about the absolute value of your mortgage being due today or the absolute value of what you owe on that paper you sold last year to buy all those shares back. I leased a car, does that mean I have $50k in an unfunded liability, sure, but does it mean i give a shit about it? no, because it's due incrementally over the next 36 months. by forward pricing to today that which is due incrementally or not due for perhaps 20 to 30 years is misleading at best, idiotic and shortsighted at worst.
Unfunded liabilities arent on a schedule like your Hyundai jackass.
Hey brother, you forgot the revenue side of your argument . If your car payment $100 per month but your take home is $90. How do you pay the liability without additional debt you cannot afford?
Get it? Great, now get back to handing out your red or blue presidential candidate bumpers stickers or to your govt job that I fund asshole.
11. The .001% only own 98% of everything on the planet. They still want the other 2%
Let them burn fighting for it...
Speaking of last years ebola scare, what happened?
Did everyone die or did they get cured? Its like a switch got turned off on that.
We're all dead. According to some prognostications.
pods
All fear and scare tactics to control the menace, I mean population. Crock of shit just like the Vaccine pushers.
I agree with pods.
Sorry folks, this is hell. );{D>
Buster Cherry,
Last year's Ebola scare caused Dallas County almost $850,000. Bet they didn't have that budgeted, and if I lived there I would be highly pissed about allowing anyone in the country from a known Ebola outbreak region.
Hell's bells, the US quarantined immigrants in the 1800's to prevent just such things. Are Americans in our PC correctness mode just getting stupid?
Yes. Thus the rise of Trump
I have often thought ISIS would consider several coordinated ebola outbreaks in this country. It is possible to engineer and with these porous borders, even easier to implement. The effect wouldn't be a massive outbreak ( ebola ain't no influenza) but an economic blow. This is similar to 9-11 in the sense of the economics that followed. A lot of bang for the buck. Treatment for one case is expensive and requires massive amount of blood products. Enough draw on the system would be devastating.
Ok, just musing. Maybe someone will bet an Oban on it. It would be nice to sip sitting on tires stoking my burning barrel.
Miffed
this just from CNBC....
"We know theyre going to raise rates soon so wheres all the confusion????"
11. Not enough seniors have starved to death yet
Let's also not forget a little something called the Federal debt. Each 1% increase in nominal interest rates leads to another $180 billion that gets heaped onto the annual deficit. "Normalized" interest rates would result in about $540 billion in added interest costs, just against the supposed Federal debt. Half a trillion here, half a trillion there and you're starting to talk about money even a bankster would notice.....year after year after year after year.
I think they'll raise rates just because they hate America.
11. Too much porn on the internet.
Seems as good a reason as any these days.
Or if you prefer -
11. Not enough porn on the internet.
The tone and saracasm of this piece perfectly describes how many of us feel. The entire thing has become a huge joke, as central banks clearly have no idea what they are doing. The U.S. followed Japan down the rabbit hole of ZIRP and QE, not paying attention to the fact that after 20 years, Japan is still doing increasing amounts of this nonsense and things have yet to improve.
Low rates beget low rates. They starve people of spendable interest income, encourage overcapacity via an artificially low cost of capital and encourage dangerous and ultimately deflating asset bubbles which are now readily apparent in many asset classes.
Nicely done academics, nicely done.
The fed will just buy CEDE and CO, and replace the NYSE with an online bingo hall based out of some Quebec Indian reservation.
Folks from Jefferson to the recent One Belt One Road article by a Chinese General have worried that a central bank could use interest rates to rob the public...first with low rates to create borrowing, the raise them to collect on the debt in real things.
If Yellen creates a crash due to an interest rate lift she would certainly be open to some severe 'criticism'.
Looks like they already sent her on that rocket powered chair to the moon.
That is why she is trapped. She wants to raise rates to be able to declare victory as she has met both the price stability and reduced unemployment mandate ( I don't want to hear inflation is below 2%, the actual mandate is price stability, not 2% inflation as measured by a downwardly biased PCE statistic).
Her primary fear is that she preciptiates the 3rd major crash under the Fed's watch over the past 20 years. Greenspan is out there telling everyone that there is a dangerous bond bubble, leaving out the part that the Fed caused it.
Sheesh! I'm a better analyst than most these morons getting a paycheck for their 2 cents.
There will be no rate hike. There never was going to be one. Any kind of hike will burst the bond bubble and all the derivatives will come tumbling down.
There will be no QE4. There will be no more "kicking the can." St. Louis FED VP Williamson has already admitted that QE1 - QE3, amounting to 4.5 TRILLION is a complete failure. So, how can anyone convince themselves that a QE4, having to amount to 12x the bailout of '08 will make a difference? (not 10s of trillions, but 100s of trillions) Especially that you do not have China now to float another QE. Believe me, they are pissed about much more than Tianjin ..
http://wantarevelations.com/2014/01/wanta-plan-macro-financial-economic-...
http://eagleonetowanta.com/
That "glitch" on July 8, was no glitch. It was a response from the PRC, for the attack it received on the Shanghai Exchange via Langley (via Cochise County, AZ) & Friends, beforehand. Interesting ZH, that included you in that attack. Why is that? What did you do to piss off the PRC? And how do you think they are going to respond to Tianjin? I have my sources. You find your own, and do your own homework. Right now, I'm pissed off with the "consent of the governed."
The goose is already cooked to a crisp, why stop now.
A couple of reasons why they WILL raise rates.
1) it's part of the original Greenspan Plan of 1997.
2) Notice how the Fed is starting to dis QE. That means that all future printing will be "secret and classified" to quote the Negro, All expenses pegged to interest rates will be paid 'on the qt' out of the Fed's newly found -- in the basement -- digital monies. (you didn't hear this from me)
3) Now that we're in a full-blown recovery, the banks want greater participation in it, offering higher rates for lines of credit, mortgages, etc while doubling the rates they pay their depositors, .50% interest for savings deposits and perhaps as much as 1% on a 60 month CD.
Happy Days Are Here Again
It was zero interest rates that furthered the shale oil boom and caused oil prices to drop and according to some economists all other commodities are in the same situation. How will raising rates cause commodities to crash? The fake stock market will go down but that's what the PPT is for so even that might not be too bad. Commodities will balance out at a better level. Grandma will earn some interest and put a few real veggies in the Ramen noodles. What's not to like?
I like his style.
10 reasons why the fed can go fuck themselves
C’mon folks. The number 1 reason and the only reason ole Gram will have trouble moving interest rates is the FED is in a corner. A political corner of their own making. Since the US economy is now effectively run by politicians and monetary “policy”, raising interest rates will prove to be the third rail of the current political environment. What I mean by this is when they move rates on the 18T-20T of debt, well they have to “budget” more for the old interest sector of the budget. That will bite into the shrinking discretionary spending by the politicos and this just can’t happen, no way, no how, especially with a Presidential election on the immediate horizon. I don’t know the specific number but it is big, the impact, of say a .25% move in the FED rate creates havoc with the budget. The increased loss to the political discretionary budget (pork) dwarfs even the “hated” sequester.
Each 1% is $180 billion in additional spending due to increased interest on the debt.
RE
You forgot to add, "ever", to the end of this headline.
The Fed shouldn't even print the minutes at this point. Waste of paper. Just a piece of paper that says, "Wait for It", would suffice.
To me the most obvious reason the Fed can't and won't raise interest rate is that all the long term holders (except Fed) will dump the low interest rate bills and swap for high interest rate. Hence the yield will rocket and the Fed won't and can't afford to let that happen.
Fed will raise the rates and good or bad does not come into it.
In the central banker world raising taxes, hiking interest rates they associate with GROWTH because it is a push form of price inflation.
Price inflation they shout GROWTH, GROWTH all to justify the current level of debt.
Failure to justify the debt puts you into the Japanese or Greek position.
Realising this it all makes sense and all the words we here are to prepare you for when it happens. Like ooooooo we knew that ... but you choose to ignore the real reason as to why.
Carry on beleiving sheeple
13. because she can't spell rayt hiyk
#1 Reason: The TBTF banks would rather sabotage the economy to create conditions that won't allow Fed to raise rates. If that means slashing jobs, shuttering banks, so be it. ZIRP has become the opiate in which TBTF banks are hooked on.
The article missed a big primary reason. If interest rates went to 1% the whole central bank system and the derivatives they are holding would blow up in their faces. Bye bye CDS. Don't forget about DERIVATIVES. Why do you think all these banks are trying to get their hands on PM's?
He forgot the biggest reason of all: Christmas
Janet will not settle for anything less than gold (which is now also worthless).
This statement alone gives me a real clue behind the mindset of the author. Gold is "worthless"?? Really??? Sounds like the MSM/Main Stream Finance mantra to me . . . . . total bullshit.
Expect 0% for years and QE4, then QE until the US dollar tanks.
11. BRICS shivers