March Rate Hike Odds Reach 90%

Tyler Durden's picture

The Fed jawboning has gone well... too well. Dudley, Harker, Kaplan, Williams, and Brainard have managed to push the market-implied probability of a March rate hike from around 20% to 90% in a week. The Fed is now cornered...

 

(we do note that Bloomberg's WIRP function uses midpoints and is likely overvaluing the probability but the trend is unmistakable)

What happens to Fed credibility if they do not hike rate now?

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DaMule's picture

They caused it, now they have to live with the consequences.... or just blame D.J.T.

kliguy38's picture

china will devalue.....waatch the chaos start

SomethingSomethingDarkSide's picture

Fed needs to be abolished for u-turning markets at their every beck and whim - this is fucking horse shit

ParkAveFlasher's picture

1) Hint at rate increase

2) Markets dip

3) Hinters buy the dip

4) Don't increase or increase marginally

5) Markets rip

6) Hinters sell the rip

AR15AU's picture

If Janet actually carries through with this, she will single handedly destroy every currency out side of the G6, brining starvation and famine to the 3rd world. She's bluffing. They can masturbate the rate all they want under 2%, but they will never put a real rate in place again. 5% yields and above will only come after the collapse of the Federal Reserve system.

runningman18's picture

The Fed isn't "cornered", they've been planning to hike rates all along.  Time to bring the house of cards down on Trump's head.

DogeCoin's picture

Stockman did say it would happen in that interview. Beware the Ides of March?

Giant Meteor's picture

Exactly, Ides of March. You beat me to it ..

small axe's picture

debt ceiling expires on the same day the Fed makes its announcement

March 15 will be a hoot ... ol Yella gonna get a well-deserved grilling

thesonandheir's picture

There's  a 100% percent chance that 90% of the Fed are clueless idiots.

NugginFuts's picture

It seems as though they've managed to set themselves up for one of two scenarios: 1) an economic collapse which will be blamed on them or 2) the need to go to war to shift the blame somewhere else.

Which will it be? War or collapse? Gentlemen, place your bets!

Giant Meteor's picture

I believe this is the plan. False flags, war. Murum aries attigit, Flamma fumo est proxima. 

Carpe Deim!

Giant Meteor's picture

War and collapse, or collapse then war ..

It is certain .. like the wings of the black swan, death and destruction.

"Tell me, spirit - are these the shadows of things that must be, or the shadows of things that MIGHT be?"

Masaix's picture
Masaix (not verified) NugginFuts Mar 2, 2017 10:09 AM

Since Trump has taken credit for the stock market rally since he got elected, he will be the natural target for the blame once this market heads south for whatever reason. If Trump had acted with a little more intelligence he would have not taken credit for the DOW breaking 20k. During his campaign he was screaming left and right that the markets are in a bubble. Now suddenly they aren't? I guess the bubble is in the eye of the beholder.

arkel's picture

The sooner rates go up, the sooner this bubble economy can pop. We've been waiting long enough.

AR15AU's picture

Its like they are putting the liberal establishment on the train tracks to try and slow the Trump train. Lol... oh please Janet please, don't implode our beloved government and it's ponzi finance machine.

Rainman's picture

Fed cred is zero anyway so hike/no hike away.

Soul Glow's picture

Yeah hike 25 basis points, that's going to curb the inflation that has stocks and housing to all time highs!

hotrod's picture

DONE DEAL.   The Fed let us know ahead of time.  My how things have changed. I remember a time when not a thing was said until the Fed meeting. 

Thinkpad's picture

Ditto the MO of late is to telegraph their intent so as not to be too disruptive to the markets. Certainly a good argument can be made that asset bubbles are rearing their ugly heads after years of unprecedented accomodation it's now time to apply the brakes. A touchy feeley Fed takes all the fun out of it in my view.....

Thinkpad's picture

Ditto the MO of late is to telegraph their intent so as not to be too disruptive to the markets. Certainly a good argument can be made that asset bubbles are rearing their ugly heads after years of unprecedented accomodation it's now time to apply the brakes. A touchy feeley Fed takes all the fun out of it in my view.....

Masaix's picture
Masaix (not verified) Mar 2, 2017 9:53 AM

One rate hike wont mean shit for the market. What matters is the long term expectations of future rate hikes. Right now it seems that the market is pricing in the fact that the FED will stop hiking if the market tanks, so no one cares about their hikes anymore. If the fed signals that they will indeed now proceed with the all the rate hikes they have been promising for years then this market is toast.

AR15AU's picture

Silver returned what... 18% last year? So we are supposed to sell our silver and go rushing in to a JP Morgan Chase account which will be going to 0.75% at some point in the distant future, while inflation rages on in everyday items? Yeaaaaah... ahahahahaha... fucking idiots!

Libtard's picture

Thats what Im thinking, like a quarter percent is gonna matter.

Bam_Man's picture

1.8% GDP growth now forecast for 1st Qtr 2017.

Higher interest rates will fix that.

Masaix's picture
Masaix (not verified) Bam_Man Mar 2, 2017 10:13 AM

Also keep in mind that the official inflation is already 2,5% and looks to be heading up, so REAL gdp growth is significantly negative even with official numbers! The FED is raising rates straight into a stagflationary economy. I can't believe they can be this stupid.

Bam_Man's picture

GDP is adjusted for inflation, although the "GDP deflator" is often less than reported increases in CPI.

AR15AU's picture

They are idiots... we all knew that the Fiat endgame is national suicide... Janet will be the one to pull the trigger apparently. I'm grabbing popcorn. This will fuck the socialists and the ponzi a lot worse than the holders of gold and silver. Bring it!

CHoward's picture

"The Fed is now cornered..."

 

Liars, thieves and low life bottom feeding scumbags are never cornered.

Bam_Man's picture

Reminds me very much of early 2000.

The Fed began tightening in March, and got in three rate hikes totalling 75 bps by June.

And then the bottom fell out of the economy and stock market.

Hohum's picture

If Wall Street wants a hike, there will be a hike.  It it doesn't, there won't be.  With a hike, Fed will also raise interest on excess reserves.

GRDguy's picture

Are these the same folks that told us Hillary had a 90% chance of being elected?

Fake Trump's picture

Trump will throw Wall Street under the bus. Wake up and don't bet on him. Sell now before a flash crash. 

chosen's picture

The normal rate on basic bank savings accounts used to be 5%.  It is now around .05%.  We have a long way to go to get back to normal.   On the way, we get to see the housing market crash, the stock market crash, and the bond market crash.  Popcorn sales will be up.

Baronneke's picture

"What happens to Fed credibility if they do not hike rate now?"

 

Did the Fed had any credibility left ???  Personaly I think it's just a bunch of Weasels, not intended to hike.  Not this year, not next year.......Never, for the simple reason that they can't,  given the shape of the economy.  (and I don't even mention interest payments on the enormous debt-pile. (Governmental, households and businesses)

Albertarocks's picture

"What happens to Fed credibility if they do not hike rate now?"

Nothing.  It will still be at zero.