March Rate Hike Odds Reach 100%

Tyler Durden's picture

Following the massive ADP employment beat (but productivity disappointment), March rate hike odds finally upticked to certainty. Fed Funds futures now imply a 100% chance that The Fed hikes next week.

Up from low 20s to 100% in a month...


What did The Fed see that suddenly spooked them all?

Which reminds us of the WTF-est chart we know of right now - as The Fed's forecast for
GDP collapses, so the odds of a rate hike soar (FF Futs tumble)...

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Joe Sichs Pach's picture

Similar odds to Hitlery winning the election

spastic_colon's picture

you know markets may be topping when _____________ ?


<hint> it rhymes with "they ignore all news of any knid"

Rich Stoehner's picture

Gonna be yuuge when they wait til May

WTFRLY's picture

Those are Atlanta Falcons Superbowl champs odds

SomethingSomethingDarkSide's picture

They've created a system that rewards bad data, and now the data is SO BAD, the market is just running away - it would be crashing, but the rules have been adjusted in such a way that things work opposite the way they should.  Markets will crash upwards until the next Lehman, could be a while.

It will most likely be an arbitrage, risk parity, or highly leveraged fund that eats it first.  Real Estate will light the powder keg, imagine the exponential costs associated with higher rates and 30 year mortgages on already overpriced American shanty housing with incomes in the gutter.

mily's picture

upside down, inside out

PopTheBear's picture

Either 1 of 2 things happen:  1) Bad data: "Shit you guys, more QE must be coming to deal with this!" --> Bullish. 2) Good data: "Wow you guys the economy is really recovering. Better own me some stawks. --> Bullish. It will crash upwards until the end of QE, which may be never.

SomethingSomethingDarkSide's picture

On the contrary, is HAS to break at some point - all it takes is one systemically risky counter-party to fuck up so bad that bailing them out becomes inconceivable.  I.e. Fed can't bail out every Tom, Dick, and Harry land lord or homeowner.  It will be ARM Loans and homeowners that bring this curtain down, again, because they're out of the Fed's bailout reach.

LawsofPhysics's picture

Yes, the system has been rewarding bad behavior for 40+ years.

Fuck all the useless paperpushing fucks, time to start taking their heads and those of their political puppets.

Nothing changes otherwise.

Dr. Engali's picture

Peak rates, unless they want to invert the curve. 

spastic_colon's picture

maybe....with XX trillion debt why not bring long rates way down?

Dr. Engali's picture

The long rate will come way down once the fed starts breaking things by inverting the curve. BTFD on long dated treasuries.

BigFatUglyBubble's picture

They will reverse it like they did last time.

jus_lite_reading's picture

March 15th. Watch the 30's curve. I think it should jump out to everyone that the Fed has been playing a dangerous game of bluff with the markets for too long. I do believe that MOAR QE is on the way. It has to be or the status quo collapses and they won't let that happen. To see the EURO's future, see: Zimbabwe. To see the USD's future see: Zimbabwe. Any questions?

Good. Using all historical data of hyperinflationary FIAT collapses as a template I questimate we have about 10-15 years before the hockeystick flies off the handle.

LawsofPhysics's picture

You sir, are an optimist.  Given that the exponential growth in liabilities that all governments have been experiencing for 30+ years, coupled with the performance of equities around the world, and the fact that the true cost of living is being HIDDEN by bullshit statistics, we have already begun our shift to hyperinflation.  This is why so many price controls are being put in place around the world. Raising rates now while still leaving the fundamental cause un-addressed and the underlying fraud intact only insures a complete loss of faith is coming faster than most will admit.  Local governence will soon be all that matters.

Tell me, how does one measure "inflation" when nobody accepts your currency?

tick tock motherfuckers.

jus_lite_reading's picture

Agreed but what's your time frame? 1 year? 5?

alangreedspank's picture

Perhaps that's the idea. I don't think Bernanke did it by mistake.

lester1's picture

Janet Yellen and her cronies at the Federal Reserve plan to raise interest rates and trigger an economic collapse. It will start in the bond market.

March 15 will be the date when the Federal Reserve raises interest rates and makes the biggest blunder in their history.

LawsofPhysics's picture

Blunder? I don't think you understand how this private bank works or what their true goal is.

chubakka's picture

well, it may not crash it.  the market is expecting it plus it would probably take several hikes not just one. 

Sunny2's picture

Is it priced in gold? 

Seasmoke's picture

The Atlanta Falcons laugh at this chart.

hotrod's picture

About as painful as it gets

PoasterToaster's picture
PoasterToaster (not verified) Mar 8, 2017 9:02 AM

End the Fed.  That is all.

BigWillyStyle87's picture
BigWillyStyle87 (not verified) Mar 8, 2017 9:03 AM

I would love to see them keep raising. I cannot wait to see what they fuck up this time.

GRDguy's picture

Are these the same statistics that said Hillary would win the presidential election?

JoeTurner's picture

The next bubble crash will be epic. I have a feeling this will be a long hot summer...

PopTheBear's picture

It's this weird assumption that 'GDP is lagging' --> MOAR QE! Bad data makes investors expect more stimulus, rocketing the S&P higher.

sudzee's picture

Raising rates is deffinately an anti-Trump move by the FED. 

misalkin's picture

It really looks like the man in charge about rates is Goldman Sachs and not Yellen. She has no say.

jamesmmu's picture

Usually when everyone know one thing is going to happen for sure, Wall st will back off, because they are the house, they dont want to lose. brace for the selloff.

LawsofPhysics's picture

Correct, unfortunately the vast majority of sheeple don't have a fucking clue. The fed is in fact irrelevant as global Weimar is a done deal.


LawsofPhysics's picture

Go ahead Mr. Yellen, quit jawboning and hike the fucking Federal Funds rate already!!!


"Full faith and credit"

Bryan's picture

A 100% probability?  That means it's a no-risk trade-- you can't lose!  Gotta love this 'market'.

hotrod's picture

 Continued Rate hikes?  What ya gonna buy?  Bonds NO,  Stocks NO, Realestate NO , Where is all the money going to go when it is best to sell these investments?

USD, money markets, YES  What else?

wonger's picture

Just placed a bet here in UK on no rate increase, odds 12.5-1, is anyon else having a punt?

Pop3y3too's picture

Impatiently waiting for Silver to get the rate hike hint and drop back down into the 16s so I can patch the holes in my leaky boat with it.

hotrod's picture

Better to coat toilet paper with it as it is an antimicrobial

Pop3y3too's picture

Fish don't use toilet paper, do they? Although, I imagine the lake I like to fish is pretty well inoculated by now.

Uranium Mountain's picture

Janet needs to raise the rates.  10 Year UST  yield currently at 2.567%  + .25 = 2.817.  Yes...  pop the big Bond Bubble.  

Turin Turambar's picture

Call me skeptical, but I am expecting no rate hike and another rampapalooza on the news. However, there will be very strong , hawkish jawboning about a soon to happen rate hike.

PurpleNIRPle's picture
PurpleNIRPle (not verified) Mar 8, 2017 10:54 AM


coast1's picture

why is costco raising their membership rates?   I thought there was no inflation and everything is great?

Carl LaFong's picture

If GDP is down, a rate hike will slow things down even further. Isn't this what the FED is supposed to be trying to avoid?