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The Complete Fed Decision Preview: All You Need To Know

Tyler Durden's picture




 

At 2 p.m. EST, the only thing the financial world will care about and discuss will be the Fed's [first rate hike in 9 years|epic disappointment]. So for those who still haven't made up their mind about what the Fed's [dovish|non-dovish] rate hike means, here is all you need to know.

First, a list of all the key announcements and public statements that everyone will be parsing at a feverish pace, courtesy of Citi:

The schedule

  • 14:00 EST/19:00 GMT: Statement and economic projections
  • Expected alongside the statement: Implementation/operation details note released by NY Fed regarding lift-off.
    • NY Fed website press releases: https://www.newyorkfed.org/press/index.html
    • Adjust the target band: increase overnight reverse repo rate from 0.05% to 0.25bps
    • Of primary interest will be the size of the overnight reverse repo facility that the Fed will put in place to pull short rates higher. Citi US
    • Rates Strategy doesn’t think it will be unlimited, but a size large enough that will keep short rates from falling below the 25bp floor – and the size could be as high as USD1tn.
    • The o/n reverse repo program is meant to be temporary in nature and will be phased out when the need to pull fed funds higher is not needed. It will be interesting to see how long the RRP program will be needed – perhaps till we get closer to 1% on IOER.
    • Doesn’t expect changes to size of term reverse repo operations or any further guidance on ending re-investments at this stage
  • 14:30 EST/19:00 GMT: Yellen Press conference

 

How are rates hiked in the age of a $4.5 trillion Fed balance sheet? The following Deutsche Bank infographic explains:

Views on the rate path:

Citi Economics believes that the Fed's path of rate increases will begin in December, but will not reach above two percent until 2018.

The second rate increase will likely not occur until mid-2016. The very shallow projected trajectory leaves the policy rate at 1% by end-2016, 1.5% by end-2017, and 2.25% by end-2018. See the tables below.

 

FOMC considerations via Citigroup:

The FOMC meeting this week is as close to a foregone conclusion as one can get with regard to lift off. However, given that the lift off is a divergence from other advanced economies which are in stimulatory mode, the reaction of rates markets subsequent to the FOMC decision is an unknown. The questions on investors mind are - will the lift off pass through the market without a significant move in the yield curve? Or will the rates curve get unhinged and if so, would it be a trading opportunity? Finally, how will short rates trade post FOMC? We highlight a few things to keep an eye on for Wednesday.

Some dots can move lower:

The “dot curve” has been generally trending lower in the FOMC quarterly meetings where the Summary of Economic Projections is published, as the Fed has had to revise down its inflation projections and push out the lift off date. Since Sep 2014, the median 2016 dot has moved from 2.875% to 1.375% and the 2017 dot has moved from 3.75% to 2.625%. As far as this meeting is concerned, we think that the 2016 dot is less likely to move lower, given that there are only four rate hikes separating the projections for 2015 and 2016. We think that the median dots for 2017 and 2018 are likely to go lower, with 2018 in particular seeming too high at 3.375%. The October FOMC minutes showed that the Fed had discussed the neutral short term rate, with Laubach and Williams being the key proponents of a lower neutral rate. If the notion of a lower than historical neutral rate has gained more widespread currency within the FOMC, then we would expect to see some lowering of the dots further out, i.e. 2017 and 2018. The long run equilibrium rate at 3.5% however could stay unchanged. Note that Kocherlakota, who had submitted a negative dot for 2015 and 2016, has recused himself from the upcoming meeting and the First Vice President of the Minneapolis Fed – Jim Lyon will be attending and submitting projections instead. We think that expectations for a lowering of the dots is already baked in and If the Fed does not lower the dots, we could see a bear flattening sell off, with the 3y to 5y sector most likely taking the brunt of the selloff.

Will there be any dissents? Until now, dissents have been driven by Lacker of the Richmond Fed who has wanted to raise rates for some time. A potential dovish dissent could arise from Evans of the Chicago Fed who in a recent speech said that he favored a later lift off date, even as he downplayed the importance of the actual lift off date. Evans’ concern is on inflation taking longer than expected to evolve to 2% even as his growth forecast for next year is closer to 2.5%. He said that if the market construes an early liftoff as a signal that the Committee is less inclined to provide the appropriate degree of accommodation to get to the inflation goal, then it would be “an important policy error”. Evans will be looking to execute a “dovish hike”.

 

Operational details:

There will be a separate document from the NY Fed with details around the operational aspects of the liftoff. Of primary interest will be the size of the overnight reverse repo facility that the Fed will put in place to pull short rates higher. We don’t’ think it will be unlimited, but a size large enough that will keep short rates from falling below the 25bp floor – and the size could be as high as $1tn. As the Fed stated in its policy normalization principles in the March FOMC meeting, the o/n reverse repo program is meant to be temporary in nature and will be phased out when the need to pull fed funds higher is not needed. It will be interesting to see how long the RRP program will be needed – perhaps till we get closer to 1% on IOER. We don’t think any changes are likely to be made to the sizes of the term reverse repo operations that have been announced for late December (total size 300bn, start dates Dec 18, 23 and 30 and maturing on Jan 4 and Jan 5). The interest on this is likely to be set a few bps over the overnight repo rate (note that the term repo over last year end was 5bp over the o/n reverse repo rate). Interest on required reserves is also likely to be moved up, along with excess reserves to 25bp. We don’t think that there will be any further guidance on ending reinvestments at this stage. The FOMC is likely to retain the language on maintaining its existing policy of reinvestments.

After the increase in IOER to 50bp, and the establishment of the overnight reverse repo rate at 25bp (an increase of 20bp from the current 5bp level), we think overnight fed funds should trade around 7-8bp over the overnight reverse repo rate, which gets us to about 32-33bp. As with past years, the fed funds rate is likely to fall towards the end of December, before moving back at the beginning of January. See Figure 2 for our expectations of short rates the day after the FOMC.

* * *

Here is a simple 5 point plan from the WSJ for the key things to look for in the Fed announcement and Yellen presser:

1. Ready to Go

There’s little suspense at this point about whether the Fed will raise rates. Atlanta Fed President Dennis Lockhart, a closely watched centrist policy maker, flatly stated last week that he’s “ready for a decision to lift off.” Private economic forecasters surveyed by the Journal see the probability of a rate increase this week at 87%. Futures markets suggest an 83% chance of liftoff as of Monday afternoon, according to CME Group. It’s hard to imagine a scenario in which the Fed would shock markets with a decision to hold rates steady.

2. Gradual Guidance

The Fed’s mantra has been that the precise timing of liftoff matters less than the path for interest rates going forward. Many officials including Ms. Yellen have repeatedly used the word “gradual” to describe the expected pace of rate increases, but policy makers also appear wary of committing themselves to anything like their mechanical tightening tempo of 2004-06. Keep an eye on the policy statement and Ms. Yellen’s press conference for guidance on what will drive the Fed’s subsequent rate increases.

3. Watch the Dots

For more clues about how quickly and how high the Fed will raise rates, check out officials’ projections for their benchmark federal-funds rate in the quarterly chart known as the “dot plot.” As of September, policy makers’ median estimate saw the rate rising to 1.375% at the end of 2016, 2.625% at the end of 2017 and 3.375% at the end of 2018, just below its normal long-run level of 3.5%. That suggested four quarter-point rate increases next year. But with U.S. inflation still running well below the Fed’s 2% annual target, officials might move their dots down and predict a slower pace of rate increases.

4. Out of Step

Richmond Fed President Jeffrey Lacker has dissented at the Fed’s past two meetings in favor of raising rates. He might get his wish this time, but that doesn’t mean the decision will be unanimous. Chicago Fed President Charles Evans and Fed governors Lael Brainard and Daniel Tarullo have all expressed reservations about raising rates and potentially could cast dissenting votes. A dissent by Ms. Brainard or Mr. Tarullo would raise eyebrows because the Fed’s Washington-based governors typically vote with the chairwoman, and none has dissented since 2005. For her part, Ms. Yellen said she “wouldn’t try to stifle dissents, and I would even expect some at critical junctures.”

5. Nuts and Bolts

If the Fed raises its target for the fed-funds rate to a range of 0.25% to 0.50% as expected, it’ll use an array of tools to tighten monetary policy in a financial system awash with cash. The Fed has signaled that the details will be announced in an “implementation note” alongside the usual policy statement, and officials will watch closely to make sure those tools work as expected. “If adjustments to policy tools or administered rates subsequently proved necessary to implement an unchanged policy stance, the implementation note could be revised without altering the [Fed's] policy statement,” according to the central bank’s June meeting minutes.

* * *

Finally for those confused by wave after wave of nonsensical positivity heading into the FOMC's tightening announcement (if it is so good for stocks, why did the Fed keep rates at 0% for 7 years and why did it inject trillions into the market), here is a less than bullish forecast on how things play out from DB's Jim Reid.

In terms of what we should expect from the post-meeting statement today, we don’t expect there to be much change to the opening statements on economic developments and prospects. We expect the Fed to continue to sound relatively upbeat on the US economy, reflecting Yellen’s recent speech and testimony although it is possible that we see a subtle change in terminology around the balance of risks on the outlook for economic activity and the labour market from ‘nearly balanced’ to ‘very close to balanced’ which would reflect Yellen’s recent communiqué. Recent turmoil in markets on the back of commodity prices and US HY could be a reason to keep the current language however. Of particular importance will be just how the FOMC chooses to address the gradualism of rate rises. This may not be explicitly addressed in the statement and instead driven home at the press conference. It’s likely that Yellen will point to her summary of economic projections and dot plots to help guide this. On the forecasts first of all, we don’t expect there to be much change to the FOMC’s median economic projections for real GDP growth, unemployment and inflation. Saying that, DB’s Peter Hooper believes that recent developments in markets mean the risk to a downward revision for core and headline PCE forecasts may have risen for this year and next. In the event of a downward revision in the inflation projection, a small downward revision to the median interest rate forecast path would be justified (i.e. reducing the number of increases in 2016 from four to three, and reducing the terminal rate. Peter points out that in his view even if inflation and growth forecasts are left unchanged, the dots could be moved lower for several reasons;

  1. The somewhat softer tenor of key inflation indicators, including inflation expectations, commodity prices, and the dollar.
  2. A case can be made for further reducing the estimated neutral level of the fed funds rate in the longer run.
  3. Likelihood of the Committee leadership wanting lift-off to be accompanied by a relatively dovish message about the ensuing path of rates and so narrowing the gap between market and Fed expectations a bit in the market’s direction would help with the digestion of liftoff.

Our US Economics team expect the 2016 and 2017 median dots to remain at 1.38% and 2.63% respectively and instead think the likeliest year for a decline in the median forecast is 2018 (3.38%) which could fall either 12.5bps or 25bps. They also expect the longer term funds forecast to come down by 25bps. Whatever happens this will likely be the key focus for markets, no change to the dots would raise the argument of the FOMC undermining a verbal message on rate hikes being a gradual process and so it would be no surprise to see markets take this negatively.

Good luck to all.

 

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Wed, 12/16/2015 - 13:30 | 6931112 OregonGrown
OregonGrown's picture

Seems like a whole lot of "juking and jiving" to me!

Wed, 12/16/2015 - 13:33 | 6931126 Newsboy
Newsboy's picture

"Push what is about to fall."

Wed, 12/16/2015 - 13:35 | 6931139 Bunghole
Bunghole's picture

Just the tip

Wed, 12/16/2015 - 13:49 | 6931219 El Vaquero
El Vaquero's picture

The Fed must raise rates, yet it cannot raise rates.  If I were going to take part in the betting, I'd choose to be the bookie here.  This shit is toxic.  I wouldn't touch it with a 10' poll.  I wouldn't touch it with Yellen's pole and Knucks pushing. 

Wed, 12/16/2015 - 13:58 | 6931257 Kolchak
Kolchak's picture

They'll keep doing the same thing, talk shit and walk shit kicking it down the road until someone with the power drags them out by their balls, yes yellen has balls.

Wed, 12/16/2015 - 14:06 | 6931298 Save_America1st
Save_America1st's picture

I dunno..the phrase "lift off" that I keep hearing sure makes me think it's code for "crash and burn"

Wed, 12/16/2015 - 14:09 | 6931315 1000 splendid suns
1000 splendid suns's picture

Pushing on a string...

Mr. Yellen, your strap on won't work any better regardless of how tight you pull the straps.

Wed, 12/16/2015 - 14:09 | 6931318 3.7.77
3.7.77's picture

Unbelievable, 1/4 percent. Could get 16+ percent cd in the early 80's, didn't end the world

Wed, 12/16/2015 - 14:47 | 6931500 NotApplicable
NotApplicable's picture

Yes, but the shit known as "financial assets" weren't piled nearly as high back then. There was also actually some tangible unencumbered collateral back then.

Today??? Not so much.

Wed, 12/16/2015 - 14:58 | 6931564 PrezTrump
PrezTrump's picture

Didn't need to read article.

Fed Rate Hike in...

3...

2...

1...

7 year cycle in the green.

all engines go.

liftoff.

Wed, 12/16/2015 - 14:12 | 6931335 kralizec
kralizec's picture

Sounds like a bad punchline...like, "May I push your stool in?".

Wed, 12/16/2015 - 14:35 | 6931450 Implied Violins
Implied Violins's picture

The Hindenburg had to go up before it came down...

Wed, 12/16/2015 - 13:59 | 6931263 manofthenorth
manofthenorth's picture

"PULL IT ! "

Wed, 12/16/2015 - 13:38 | 6931142 nope-1004
nope-1004's picture

Analyzing corruption seems like a waste of time.  They will do what they need to for themselves, NOT the economy and NOT for the citizens of this country.

Wed, 12/16/2015 - 13:51 | 6931225 El Vaquero
El Vaquero's picture

The irony there is that the system requires a strong middle class for them to continue to acquire more wealth.  They've killed the goose that laid the golden egg, and they are going to replace it with black swans. 

Wed, 12/16/2015 - 14:13 | 6931350 Victor von Doom
Victor von Doom's picture

They're banksters. They were never aquiring wealth. You don't bother with that when you can print fiat and pass it off as money.

They were aquiring power and control. Crushing the middle class just translates as more control for them - ie they are psiphoning the middle class power unto themselves.

America is headed for feudalism - Lords and peasants, no in-betweeners.

Wed, 12/16/2015 - 14:18 | 6931364 El Vaquero
El Vaquero's picture

America is headed towards collapse and civil war, assuming we don't get WWIII first.  Even bankers are going to get wiped out in this.  Their way of doing business is at odds with the laws of nature.  TANSTAAFL. 

Wed, 12/16/2015 - 14:38 | 6931465 wolfnipplechips
wolfnipplechips's picture

If they don't raise, it's moar of the same shit we've been eating.

If they DO raise, expect war

Pretty simple

Wed, 12/16/2015 - 14:45 | 6931491 Victor von Doom
Victor von Doom's picture

That's assuming the average American patriot actually has a breaking point. Personally I think we are well past that litmus test and the patriots failed.

There will be no revolt - not from this generation. It could be decades or centuries before America is free again.

Wed, 12/16/2015 - 14:48 | 6931515 Falling Down
Falling Down's picture

V von D is on the right track.

Those of us who will be working in the future will be sharecroppers, in a way.

Feudalism is what the oligarchs want.

Wed, 12/16/2015 - 14:51 | 6931526 Victor von Doom
Victor von Doom's picture

I'd say thanks for the vote of confidence - but it makes me sick to my damn stomach - I know I'm right.

Wed, 12/16/2015 - 14:24 | 6931403 DanDaley
DanDaley's picture

They're going to chicken out and eat crow because they're a bunch of turkeys acting like ostriches with their heads in the sand. Everything is just ducky!

Wed, 12/16/2015 - 14:30 | 6931426 Antifaschistische
Antifaschistische's picture

a rampant counterfeiter realizes that as the pool of "in the club" recipients increases (i.e. all the FED's owner banks/GS/etc) they soon experience a diminishing value in their counterfeit cash.  THIS is why apartments in NY are selling for 30 Million...it's the FED Counterfeiting Inflationary impact by the "first spenders" of counterfeited/fiat cash.

but, the counterfeiter doesn't really care if follow-on spenders have to pay higher prices...the counterfeiter only has to accelerate their operation to keep up.  

the only thing the counterfeiter (FED) fears is someone who raids their office and shuts them down.  THEN, and only then is the party over.

But since the FED (and it's insider boys club owner bankers) also own Washington and have the US Army as an ultimate security guard, they are pretty well insullated from a bunch of informed citizens with pitch forks and rakes.

In the meantime, don't borrow money from a bank, shop only at locally owned and operated establishments, and pay cash. (the owners know what to do with cash --- and the FEDs know they know ---- which is why they're trying to get rid of it)

Wed, 12/16/2015 - 13:52 | 6931233 Rabbi Chaim Cohen
Rabbi Chaim Cohen's picture

It is indeed. But we're all sitting here with popcorn and our libation of choice sort of expecting to witness a cataclysm at some point. Instead we are forced to watch this ridiculous prequel sophistry in super, super slow motion. Which is annoying and fatiguing, but do you dare look away?

Wed, 12/16/2015 - 14:04 | 6931287 Itgoestoeleven
Itgoestoeleven's picture

Aunt Bunny Fell down the stairs! Aunt Bunny fell down the stairs!...

Wed, 12/16/2015 - 14:06 | 6931299 agstacks
agstacks's picture

This is how I predict what will happen....

 

"What would aggravate me the most?"

"Them raising rates, the markets spiking higher, and the pundits proclaiming 'Mission Accomplished' and how smart Yellen is." 

Wed, 12/16/2015 - 14:54 | 6931548 Beam Me Up Scotty
Beam Me Up Scotty's picture

And thats exactly how its going to go down. 

Wed, 12/16/2015 - 14:06 | 6931295 McMolotov
McMolotov's picture

Same rule as last night's GOP debate: "Will the results of this change anything for the better?"

If the answer is "no," turn off the teevee and proceed to drink heavily.

Wed, 12/16/2015 - 14:35 | 6931449 jaxville
jaxville's picture

Nope.....You hit the nail square on the head.  The Fed will act to preserve the system.  Fractional reserve banking and its product, credit based money; are the foundation upon which all power of the establishment rests.

 A quote in a letter from the Rothschilds...."Those few who can understand the system (check book money and credit) will either be so interested in its profits, or so dependent on it favors, that there will be little opposition from that class, while on the other hand, the great body of people mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear it burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests."

 

Wed, 12/16/2015 - 13:41 | 6931174 G.O.O.D
G.O.O.D's picture

when the aliens from the 6th dimension finally arrive, wont they be amazed that all that is left is a pile of rubble with the HFT's trading at Dow 60,0000,0000,0000?

Wed, 12/16/2015 - 14:37 | 6931463 Implied Violins
Implied Violins's picture

I dunno, all that paper gold floating around will seem like a ticker-tape parade to them.

Wed, 12/16/2015 - 14:59 | 6931582 Bangin7GramRocks
Bangin7GramRocks's picture

And the faint voice of a dying bald man whispering that Apple is a screaming buy at $8000 a share.

Wed, 12/16/2015 - 13:48 | 6931213 BandGap
Wed, 12/16/2015 - 13:34 | 6931133 Luck Dragon
Luck Dragon's picture

<-- Rate Hike

<-- Rates same, or lower

Wed, 12/16/2015 - 13:44 | 6931186 secretargentman
secretargentman's picture

They could try something new... a "constantly variable" rate, where you don't know the rate until after you've borrowed the funds. 

Wed, 12/16/2015 - 13:47 | 6931205 Luck Dragon
Luck Dragon's picture

How about they never tell you the rate? You just borrow the funds and pay it off forever, or until they say it's paid off. Sounds like an even better plan.

Wed, 12/16/2015 - 13:57 | 6931255 El Vaquero
El Vaquero's picture

Luck Dragon picked the role of bookie in this one.  That is the smart move. 

Wed, 12/16/2015 - 14:10 | 6931322 Save_America1st
Save_America1st's picture

<-- silver price monkey hammered no matter what the decision is?

<-- aw, fuck it....just BTFD

Wed, 12/16/2015 - 14:14 | 6931352 Eyeroller
Eyeroller's picture

<---  BOTH

Wed, 12/16/2015 - 14:07 | 6931266 HardAssets
HardAssets's picture

Prediction: Same ole, same ole

With more jawboning about 'sometime early next year'

Since 'consensus is they will hike rates' . . . they likely won't. And some tipped off insiders will make out like bandits . . . Again.

Stawks up, PMs down (printing more money has no correlation to their 'price' )

Yeah, - its Crazy Land

Wed, 12/16/2015 - 14:10 | 6931320 agstacks
agstacks's picture

I think they'll raise, and markets will melt up in panic buying now that the coast is clear and mission accomplished will be the banner on CNBC for the rest of the day.  Maria will have a santa hat on laughing

Wed, 12/16/2015 - 14:45 | 6931490 Jungle Jim
Jungle Jim's picture

What HardAssets said is what I'm afraid of. More of the same of what is killing me now. I *want* the system to crash. I want to see something spectacular. Bring on the cataclysm! Anything would be better than this.

Wed, 12/16/2015 - 14:54 | 6931550 NotApplicable
NotApplicable's picture

I expect them to finally "raise" rates, as the MSM is providing the exact same "priced-in" talk that they did when they "ended" QE.

And just like the magic of sucessfully "ending" QE was all due to the reverse repo window, I expect that in a couple months time, Tyler will print an article describing the next behind the scenes bailout mechanism adopted to deal with the carnage known as the impossibility of unwinding a world running on ZIRP.

Or, the alternative recently hinted at by Hilsenbrat, which is to let it crash and burn as an excuse to officially launch NIRP (because as we all know, they have to do SOMETHING!!!!!).

Wed, 12/16/2015 - 14:54 | 6931544 Bangin7GramRocks
Bangin7GramRocks's picture

Hi guys! My real name is Steve Cohen. I got the details last night and traded accordingly all day. Whew! It's tough working so hard for $100 million. Oh, by the way. No rate hike.

Wed, 12/16/2015 - 13:29 | 6931113 nuubee
nuubee's picture

Can they do a 12.5 bp increase?

Wed, 12/16/2015 - 13:30 | 6931114 o r c k
o r c k's picture

You bet your BP

Wed, 12/16/2015 - 13:31 | 6931116 nuubee
nuubee's picture

well, shit, lets do a 1.5625bp increase then, just to make everyone scratch their heads.

Wed, 12/16/2015 - 13:35 | 6931143 KnuckleDragger-X
KnuckleDragger-X's picture

They'd run out of fingers try to count it out......

Wed, 12/16/2015 - 13:37 | 6931154 DCon
DCon's picture

Your decimal point is incorrect. Should be before the 1

Wed, 12/16/2015 - 14:13 | 6931345 kralizec
kralizec's picture

Like the Germans bombing Pearl Harbor...he's on a roll, let 'em roll.

Wed, 12/16/2015 - 13:33 | 6931123 maneco
maneco's picture

D-Day for Fed Fiat Credit System: https://youtu.be/v_5QBJx0Im8

Wed, 12/16/2015 - 13:33 | 6931125 Rainman
Rainman's picture

Sure seems like a lot of wasted effort just to roundtrip back to zero !

Wed, 12/16/2015 - 14:56 | 6931560 NotApplicable
NotApplicable's picture

They won't stop at zero next time. For all we know, today is merely providing the activation energy (ala a "mandate") to usher in our NIRPY future.

Wed, 12/16/2015 - 13:33 | 6931128 Turin Turambar
Turin Turambar's picture

Repeat after me.  There will be no rate hike.

Wed, 12/16/2015 - 13:44 | 6931187 Jacksons Ghost
Jacksons Ghost's picture

+1 for the name.

Wed, 12/16/2015 - 14:11 | 6931331 agstacks
agstacks's picture

That has been a popluar mantra around here for a while.  We'll see soon enough.. 

Wed, 12/16/2015 - 13:34 | 6931135 Maestro Maestro
Maestro Maestro's picture

No rate hike.

 

DOW up 400 points shortly.

 

Gold up another $20.

 

Crash in second week of January.

Wed, 12/16/2015 - 13:35 | 6931141 ghostzapper
ghostzapper's picture

Some folks at the PBOC and FOMC imploded some folks' carry trades.  

Wed, 12/16/2015 - 13:35 | 6931144 RawPawg
RawPawg's picture

A SHTF Crash

Overblown Arm Chair Quaterbacking Comes To Naught

 

Y'all on ZH are the Expects....So Tell Me

Wed, 12/16/2015 - 13:36 | 6931148 Seasmoke
Seasmoke's picture

How many people on the planet already know the answer. And how many people are now trading on this information.  

Wed, 12/16/2015 - 13:43 | 6931183 chunga
chunga's picture

.01% seems to be the trend.

Wed, 12/16/2015 - 13:36 | 6931151 RazorForex
RazorForex's picture

Pffff

No one will be watching Yellen today, everybody is waiting in line to see the new Star Wars. The FED should have scheduled their little meeting in the new year when all the Star Wars hype dies down.

Wed, 12/16/2015 - 13:37 | 6931156 CHoward
CHoward's picture

I'm beginning to think that we all have way too much time on our hands. 

Wed, 12/16/2015 - 14:34 | 6931444 Surviver22
Surviver22's picture

LOL, you are 100% right ... 

http://imgur.com/TGFiHbH

Wed, 12/16/2015 - 13:38 | 6931161 moneylover3
moneylover3's picture

But but everybody wants Holiday FREE MONEY

Wed, 12/16/2015 - 14:20 | 6931383 chunga
chunga's picture

How about an announcement of "Operation Grift"? A helicopter drop on the sheeple except not in cash but stocks. They missed out on the wealth effect and giving them bundled student loan, auto loan paper, etc would help main street. Naturally this would be managed by the squid.

#tribalfraudmatters

Wed, 12/16/2015 - 13:38 | 6931162 Dimons jock
Dimons jock's picture

So do we buy puts or calls? I need cash to get the fuck out of this shithole

Thank in advance! 

Wed, 12/16/2015 - 13:39 | 6931164 Caveman93
Caveman93's picture

Ain't gonna raise them. If they do it will be the smallest possible increase in history...like .0000000001625%.

Wed, 12/16/2015 - 13:40 | 6931172 Squid Viscous
Squid Viscous's picture

Still waiting for them to take the fucking menorah down in front of town hall, i may do it myself tonight about 3am

Wed, 12/16/2015 - 14:11 | 6931328 lakecity55
lakecity55's picture

The Progressives have called for the Liquidation of the Caucasian Race.

Kill them.

Wed, 12/16/2015 - 13:43 | 6931177 Jack Burton
Jack Burton's picture

IF. and I do mean IF, the Fed rasises rates this tiny fraction, they will light the fuse on a melt down. Perhaps not instantanious. After all, who of us can time any of this to perfection? But nevertheless, nothing going on in the world of High Finance, Government Finance, All forms of Debt, Mainstreet economic performance, etc. Not a single thing is screaming that "A rate hike can and will be tolerated". Instead, everything is screaming "raise rates even a fraction and the whole fucking thing is going down!"

Every lie that media and government conspire to spread about the state of finances, both private and government. All the government statistics about jobs, inflation and growth are lies. The entire world is hanging by a string, the US Federal Reserve is basically backstopping plant earth.

A giant storm is brewing, only a Fed pull back at the brink can hold it back. Instead of raising rates, the world wants Negative Rates announced, a new QE announced and more liquidity dumps as needed.

Every time the Fed hints of a raise, the water pulls back and exposes the naked, and most entities are stark fucking naked!

Wed, 12/16/2015 - 13:48 | 6931209 walküre
walküre's picture

Shemitah year has started in September. The Fed is obliged to serve up and fullfill a "mandate" or prophecy. They can't refuse or the Dollar will lose the support of the one and only religion that makes up and controls monetary instruments.

Wed, 12/16/2015 - 13:51 | 6931224 DaveyJones
DaveyJones's picture

let's see,

negative rates to keep confiscating wealth and distort markets

a rate increase and cause a meltdown,

or do nothing and everything blows up

I feel better

Wed, 12/16/2015 - 13:54 | 6931246 walküre
walküre's picture

there won't be a meltdown.. maybe a slowmo melt at worst

money is in tight hands already

Wed, 12/16/2015 - 14:22 | 6931388 Bloodstock
Bloodstock's picture

Yeah, they're gonna want to take away the guns first before the people really get pissed off!

Wed, 12/16/2015 - 14:38 | 6931469 G.O.O.D
G.O.O.D's picture

Yeah, they're gonna want to take away the guns first before the people really get pissed off!

 

That is a lunch packing job right thar

 

 

Wed, 12/16/2015 - 13:42 | 6931178 buzzsaw99
buzzsaw99's picture

Greenwich Mean Time, lulz. seven billion people on the planet. only the 0.1% give a rat's ass what the fed does.

Wed, 12/16/2015 - 13:43 | 6931182 FreeShitter
FreeShitter's picture

No rate hike, infact its all going NIRP soon.

Wed, 12/16/2015 - 14:06 | 6931301 Jacksons Ghost
Jacksons Ghost's picture

Can't Taper a Ponzi, right?

Wed, 12/16/2015 - 14:23 | 6931396 duck dodgers
duck dodgers's picture

As far as I understand it(which ain't far at all) NIRP will only accomplish their goals if they simultaneously ban physical cash too. That probably means they'd also have to ban PMs. They better run and hide if they do that.

Wed, 12/16/2015 - 14:34 | 6931441 FreeShitter
FreeShitter's picture

Why? You think sheep are gonna revolt if they do? shhhhhhhhhit pass me whatever you are smokin bro.

Wed, 12/16/2015 - 14:39 | 6931470 chunga
chunga's picture

I still believe, that when the time comes for that, a federal license will be required to possess cash for any reason. Everybody with an SS# will receive their temporary license upon recieipt of signed acknowledgement of expiration of said license. All cash transactions must be accompanied by current cash license numbers. After that date possession of cash for any reason is a crime.

Justification for this will be litlle guys that play by the rules get hurt by improper use of cash.

Of course, this will apply only to sheeple. There will be official exemptions because rule of law and fairness enforcement. Watch the fedz get the ball rolling on this by offering early participants a helicopter drop of QE, not in dollahs, but in stawks.

Wed, 12/16/2015 - 13:43 | 6931184 Kolchak
Kolchak's picture

They aint raising shit.

Wed, 12/16/2015 - 13:44 | 6931188 walküre
walküre's picture

If they don't raise now, nobody will ever again pay any attention to them.

Yes, that and the reserve currency is done like dinner. Gold price in US$ moonshoot.

October was supposed to be green lighted but they waited. Now or never.

Wed, 12/16/2015 - 13:53 | 6931239 Kolchak
Kolchak's picture

Thta's already the truth, no need to wait.

Wed, 12/16/2015 - 14:22 | 6931390 Victor von Doom
Victor von Doom's picture

Said it before and I'll say it again. This is the same Zio act as an Israeli Peace Process. They say it will happen. They insist it will happen. This time for sure...

Not a snowballs chance in Hell you stupid Goy.

 

Wed, 12/16/2015 - 13:47 | 6931201 Thisisbullishright
Thisisbullishright's picture

I thought a month ago that they would raise rates by 12.5 BP and the markets will fucking SOAR!

Wed, 12/16/2015 - 13:47 | 6931206 Peter Pan
Peter Pan's picture

While I believe that increased  equity requirements for speculative plays is what is needed first ahead of rate increases, the FED will most probably increase because it needs to show that its rhetoric about the "improving"economy is in fact correct.

I hate to think what this rate increase will do to the cost of governments funding their debt and hence the state of their budgets.

Wed, 12/16/2015 - 13:55 | 6931249 Kolchak
Kolchak's picture

Can't do it, that donkey already hung. Game is over, they just need to fucking disolve already.

Wed, 12/16/2015 - 14:28 | 6931420 Victor von Doom
Victor von Doom's picture

No, that just it, isn't it - they don't need to do anything at all. The American People didn't respond when the banks got bailed out, and didn't respond when interest rates hit 0%. Any mathematician could have told you that they could never raise rates again, particularly after letting it sit for so damn long. The consequences would be the collapse of the entire economy, with all the political chaos that entails.

They have America where they want it now -  mesmerized by the Fed's mindless ramblings and eternal sleight of hand.

They'll keep you there until you either revolt or rot. That's the unwelcome truth no-one wants to face.

 

Wed, 12/16/2015 - 13:49 | 6931216 poland spring
poland spring's picture

There is a rate hike and the markets go up 300 points.

Wed, 12/16/2015 - 14:59 | 6931581 1stepcloser
1stepcloser's picture

and another 300 when they take it back in due time

Wed, 12/16/2015 - 17:21 | 6932100 poland spring
poland spring's picture

Damn, I was close...DOW up 224 points. And I still got 3 downvotes.

Wed, 12/16/2015 - 13:56 | 6931250 VWAndy
VWAndy's picture

Its not that they are not smart enough. Its that they are constantly FOS. 100 years of yanking our chain you would think most people woulda caught on by now?

 This is the banksters utopia.

Wed, 12/16/2015 - 13:58 | 6931261 Isy
Isy's picture

Review it: review-and-bonuses.com

Wed, 12/16/2015 - 13:57 | 6931256 stateside
stateside's picture

Mr Yellen says the FED is data dependent regarding rate rises.  The data sucks.  So if Mr. Yellen raises rates and the data continues to suck then Mr Yellen will be forced to continue to raise rates as long as the data continues to suck.  Data dependent.

Wed, 12/16/2015 - 13:59 | 6931264 XXL66
XXL66's picture

Soon Vice Chairman of the FED Stanley Fischer will replace Yellen, he is born in Zambia, this is next to Zimbabwe, i kid you not.

Wed, 12/16/2015 - 14:07 | 6931303 Peter Pan
Peter Pan's picture

He might be born in Zambia but his soul is in Israel.

Wed, 12/16/2015 - 14:13 | 6931347 Usura
Usura's picture

I hear that Fischer is pals with the crypto jew

Nicholas van Hoogstraten
Wed, 12/16/2015 - 14:01 | 6931277 Kolchak
Kolchak's picture

What will cost them less? That's what they'll do, ponzi economy aside we all know they care only for themselves.

Wed, 12/16/2015 - 14:03 | 6931279 Y4-B_v8
Y4-B_v8's picture

Are Englands bookies doing an over under wager?

Wed, 12/16/2015 - 14:04 | 6931289 lester1
lester1's picture

The Fed has NEVER raised interest rates this late in the business cycle.

 

Who will the Fed blame when the economy goes into recession?

Wed, 12/16/2015 - 14:04 | 6931288 db51
db51's picture

I'll say it again....before the clock strikes midnight on Jan 31, 2015, you will witness one of the biggest ripping ass Santa Rallies in the history of mankind.   Everything will be green by Valentine's Day....and we'll be hitting new highs weekly......After today....I am never coming to Zero Hedge again.....I can't take it anymore.   Gonna grab every last dime I have and start BTFD until I've got a bankroll like Bill and Hillary Clinton.....Gonna get me some cattle futures too.  What could possibly go wrong.?

Wed, 12/16/2015 - 14:05 | 6931290 Mark Mywords
Mark Mywords's picture

For days, I've said that the Fed is irrelevant and lacks any credibility. Here we are - those few who care enough about our world, gathered awaiting the latest tomfoolery from the bankster-gangster class. Watching these people run around, spewing inanity and begging for attention while unclothed will be epic.

This is the end.

Wed, 12/16/2015 - 14:25 | 6931407 lasvegaspersona
lasvegaspersona's picture

The problem is that the world must have a functioning monetary system. It must have an easily usable medium of exchange. That medium of exchange cannot be what is used for savings. If you get that...well you don't get that do you? It is worth some thought.

Wed, 12/16/2015 - 14:29 | 6931422 Mark Mywords
Mark Mywords's picture

I think there's gold in that there comment.

Wed, 12/16/2015 - 14:41 | 6931436 Victor von Doom
Victor von Doom's picture

"This is the end."

This is the beginning. You have decades/centuries of this universal enslavement to go.

Wed, 12/16/2015 - 14:05 | 6931294 pocomotion
pocomotion's picture

For quite a few years now -- everyone has had a thesis on what a rate increase will do.  Now here we are...  All those books sold to us and will those writers be correct or just another book-burning event to attend. 

If the FED pulls off a recovery then I will turn off the internet and get back to mainstream media, pay my IRS taxes and leave you guys in my rear-view mirror.  If the FED ruin this great nation our economy then one can only surmise a revolution may be coming and soon...

Wed, 12/16/2015 - 14:07 | 6931305 Bill of Rights
Bill of Rights's picture

ZZZZzzz

Wed, 12/16/2015 - 14:08 | 6931310 Spungo
Spungo's picture

They should set the overnight rate at 5% just to see what happens :D

Wed, 12/16/2015 - 14:08 | 6931312 devo
devo's picture

Stocks will rationalize a way to move up 300 points, gold will drop 30 or 40 bucks.

Wed, 12/16/2015 - 14:11 | 6931327 Hubbs
Hubbs's picture

I don't care what the Fed does. My monster box of Silver maples just arrived.

Wed, 12/16/2015 - 14:12 | 6931330 Peter Pan
Peter Pan's picture

The one thing I keep telling myself is "if the system is healthy then let the market place determine the correct rate of interest without any interference by the FED". 

And likewise, if the system is not healthy after years of tampering, then also let the market determine the correct rate of interest.

Wed, 12/16/2015 - 14:14 | 6931351 devo
devo's picture

Everyone knows the system isn't healthy.

Wed, 12/16/2015 - 14:12 | 6931337 jomama
jomama's picture

There will be no rate raise.

Wed, 12/16/2015 - 14:14 | 6931353 devo
devo's picture

Extremely possible. What are the odds of a surprise QE instead of a rate hike? Probably higher...

Wed, 12/16/2015 - 14:12 | 6931342 Sanity Bear
Sanity Bear's picture

you can only be disappointed if you expect a rate hike

 

why set yourself up?

Wed, 12/16/2015 - 14:19 | 6931373 anyways
anyways's picture

Probability of an upcoming Fed Rate hike is: 79,4%

simple as this.

Wed, 12/16/2015 - 14:20 | 6931382 Squid Viscous
Squid Viscous's picture

i have a bid out at SPY 150 just for shits and giggles

Wed, 12/16/2015 - 14:21 | 6931386 lasvegaspersona
lasvegaspersona's picture

Great...we get the beginning of the great deflation (followed quickly by the greatest hyperinflation) or the complete loss of Fed credibility.

Should be a good show.

Wed, 12/16/2015 - 14:23 | 6931399 MrNosey
MrNosey's picture

It's ridiculous, there is no real inflation in sight!

The agenda rolls on......

http://beforeitsnews.com/conspiracy-theories/2015/12/as-events-spiral-ou...

 

Wed, 12/16/2015 - 14:26 | 6931408 SgtShaftoe
SgtShaftoe's picture

I predict that they will "decide" to raise rates but will set the liftoff date far enough in the future that they won't actually have to do it (March maybe feb).  then they will simply allow the current economic depression to get more scary.  problem solved.  

shit, I should start a newsletter

 

 

 

Wed, 12/16/2015 - 14:28 | 6931417 bankonzhongguo
bankonzhongguo's picture

Frankly, in this age of micro-payments, micro-aggressions and Central Bank face savings why these characters do not simply raise rates by 10bps or five in their effort to telegraph "something" that they are still the Galactic Overlords pulling the spider silk threads on the Financial Ecliptic is beyond me.

They could double the overnight repo rate to 0.1% and call it a year.

I think however one interest rate competent that goes to the fabric of US political economy is its impact on government borrowing and pension obligations.

There is still a huge unspoken Battleship Potemkin of Illinois, New York and California government democrat pensions that have to be funded by creative accountants. Higher rates with a stock blow-out could really impact confidence and service in local government again. That with real estate deflation and lower property taxes.

Ooof.

 

 

Wed, 12/16/2015 - 14:39 | 6931471 Janet Shalom Be...
Janet Shalom Bernanke's picture

It's actually quite astounding, even us crooks at the Fraudulent Reserve are amazed:

Here we cause repeated market crises, are given the power to make banks and financial institutions spend tens of millions of dollars to build systems to "stress test" their portfolios to model how much money they will lose when the next market crash comes, and the public sheeple hang on our every utterance as if we are gods!!  

Only in Amerika could such a fantastical dream like this occur!

Wed, 12/16/2015 - 14:43 | 6931485 SgtShaftoe
SgtShaftoe's picture

Oh, the suspense!!!  you t minus 20 min until the mouthpiece of sauron doesn't do a fucking thing but flap her maw.

 

fuck the fed

 

 

Wed, 12/16/2015 - 14:52 | 6931536 Ghost of Porky
Ghost of Porky's picture

Newbie here. Can anyone recommend some good stocks to invest in?

Wed, 12/16/2015 - 14:59 | 6931563 QE49er
QE49er's picture

I just want to tell you all good luck...we're all counting on you. https://www.youtube.com/watch?v=aB2yqeD0Nus

Looks like I picked the wrong week to quit smoking... https://www.youtube.com/watch?v=VmW-ScmGRMA

By the way...Is there anyone onboard who knows how to fly a plane?  https://www.youtube.com/watch?v=zXpFznXb_vI

Do NOT follow this link or you will be banned from the site!