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Time to hike rates then?
Charts: Bloomberg
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A survey whose results I actually believe. Imagine that.
ll this Fed blather is nothing more than the jawbone(ing) of an ass(face).
Raising rates is the only way out of the deflationary trap but it would force an epic "cleansing of debt" which is why it will never happen.
Japan is the model for what we're going through and the FED knows that and knows why they were trapped so the correct move would be to let rates set themselvess and let the market sort it out.
Were that to happen I think what you'd see is once everyone figured out the market was on it's own, then you'd see risk return to the equation and render re-pricing of assets like the world has never seen before.
Since the FED has entered this territory they are completely and utterly trapped or more accurately, WE ALL ARE TRAPPED in ZIRP soon to be NIRP.
The FED doesn't set rates they follow the market or that's how it should work. You CAN set rates for a time by playing with weapons of mass destitution like the FED has but if you do that you literally BECOME the market and you can't exit from that.
We should all pray for higher rates because that turns the mindset of people into one of get it before it costs more and so the velocity of the economy picks up due to expectations.
Right now the correct expectation is why act now? Wait and get it cheaper when it comes to assets and that's how you get trapped into a zombie economy from hell.
The FED knows all this though because unless they are stupid we are wandering right along the Japan template and they can't make even me believe they are too stupid to see that.
Good post. I saw an example of this yesterday in a department store where the wife was telling her husband not to buy the 80% discounted jeans right now as she almost yelled at him, "wait because it 's going to get cheaper."
It's interesting to see what sectors have NOT corrected like the stawk market and the housing market which are both abouot 60-80% overpriced. Many other sectors have actually overcorrected. House prices, rents and stawks will inevitably follow and it will be bloody. Or should I say, "bloodier"?
Agree, NIRP is next.
Most assume no increase...exactly what is coming, that and a judicious cleanse...haven't you seen the big boys moving out of equities while keeping the indices up?
"2% target" LMFAO!
Some of these are fantastic.
http://www.greatlifequotes.org/2011/07/best-star-trek-quotes/
Need to lighten it up a bit. The news is coming in like watching an elephant take a shit, never ending plops.
Watch out for hippos as well
https://www.youtube.com/watch?v=SwGpzQV8ZZ4
Obama and the so called Democrats have single handily destroyed the US consumer,,,
Oh please. I'm a lifelong Republican, and even I know this is a rdiculous statement. Both sides have happily dragged this economy to the edge of the cliff.
What do you mean oh Please, Shrub was scorned from the day he took office, lets these cunts take a few jabs..I agree it is both sides and their side is gonna take a few.
Unless the economy holds off from tanking until the next regime takes office, and even then it will only be the fault of El Prez if it's a GOPer in office...the letter networks would never pin a faulting economy on Clinton...
Do you understand what the term "single-handedly" means?
I agree. Boner and the Do Nothing republicans simply sat by while Barry, Piglosi and Reed and chums destroyed the usa middle class. To that extent they cooperated with The Kenyan.
Isn't EBTs considered propping up the consumer? Swipe, swipe ya'll
This is setting up (for the Fed), like a meal from the French Laundry - perfection... What - another week or 3 of these numbers and a 'rate hike'...? The table is being set now for the 16" $$$guns to fire.
Is it deflation or inflation when money is exploding out of every banking orafice, but all of it is gifted to a few people? Clearly, the real economy is being crushed. The bankers only use their free money to gamble. They have no need to make loans to invest in the real economy, as they were designed to do. We do not have a functional banking system anymore. But the money is real enough. It will be interesting to see how this plays out.
Can't Stop the Manipulation, Inc.
Buy a house you guys. And fill it with cheap, financed crap imported from 3rd worlders. Bush left the light on.
"We can put light where there's darkness, and hope where there's despondency in this country. And part of it is working together as a nation to encourage folks to own their own home."
- President George W. Bush, Oct. 15, 2002
This Deflation is killin my budget. Wife and I talkin last night hew can we reduce our INSURANCE(home, cars, toys, etc. and Health Care costs. Decided we would start by dumping the $20 the two of us spend going to Wendys or Subway. Amazed that 2-single combos (large fry)with tax runs $17 at Wendys.
Find a local Little Caesars. 14" Pepperoni for $6 without waiting. Wife and I hit it up last week, I have never seen a place so busy...and it wasn't all white trash or EBT swipers...people are making legitimate changes to "eating out"
BK has a 2 for $5 deal and they're decent sized sandwiches, split a fountain drink and a small fry and you can eat out for under $10 with tax.
We have a local 5 Guys, its arguably cheaper to eat there than at the McDs across the street, especially when you figure in quality of food.
"Time to hike rates?"
These people aren't going to hike shit. At best, they'll do a quarter-point of this or that, and promptly retreat the minute the markets choke.
That's all they can or will do. So anyone hoping for interest-income in their lifetimes is going to be disappointed.
Since I don't like to participate in the US economy beyond the bare minimum, I decided today to check out my health care options, now that I've reduced my reportable income to near-zero and next year will begin collecting SS checks (whoopie! less than $400 a month - I did my best not to contribute and am reaping what I have sown).
So, NY, now that the biggest provider has failed (HealthRepublic), and about 200,000 people need to sign up in the next few days, I guess, I find myself exempt again and NY, that bastion of progressive bullshit, has the "Essential Plan", for which I qualify on the lowest rung.
Everything is free, up to and including dental and eyecare. WTF?
Here's a fact sheet:
http://info.nystateofhealth.ny.gov/sites/default/files/Essential%20Plan%...
It's gotten to the point that it's truly better to be poor than work for a living and pay your "fair share."
It's a fucking mess, but, if it costs me nuttin', I'm signing up.
The whole country is fucking broken, but I think NY has a sizable lead on many other states.
Just as we used to remark about inflation, the only thing worse than deflation is talking about it.
'Deflationary mindset'. Corruption of the language so no one can think.
It is called 'down side of the business cycle' in more descriptive terms that do not assume an explanation in Keynesian theory. 'Credit deflation' has exactly zero additional explanatory power unless you are running a keynesian model of some kind.
'Inflationary mindset' must be the answer ,if 'deflationary mindset' is the problem ?
Deflationary forces? Yes.
Deflation? No. Real inflation is still about 8%.
Deflation is GOOD. Deflation is NECESSARY if the world economy is ever to function again.
The notion that inflation is good is INSANE. The only reason that idea is taken seriously is because high inflation tends to be good for irresponsible excessively consuming individuals and entities that get way over their head in debt.
However, it thwarts, punishes and destroys responsible individuals and entities, thus creating a world with more irresponsibility and pointless consumption... yet less production.
Which means... lower standard of living.
BAD NEWS... but the irresponsible excessive consumers are in control, and have thus gone right ahead and destroyed the world economy. And that will continue until and unless responsible producers "just say no".