Page 1 of 2 12 LastLast
Results 1 to 10 of 12

Thread: Federal Reserve's Coming Rate Cut Makes No Sense

  1. #1
    Join Date
    Apr 2017
    Posts
    2,173

    Default Federal Reserve's Coming Rate Cut Makes No Sense



    There is some kind of weird psy-op between Trump and Powell [who Trump appointed as Federal Reserve Chairman.]

    Trump has repeatedly attacked Powell, demanding he lower the federal funds rate. Trump wants Powell to lower the federal funds rate so the all time high stock market will rise even higher [at the same time it would hurt pension funds, seniors and others who can't put their money at risk.] Now it *appears* Powell has caved and the stock market is again at an all time high just on the *speculation* that Powell will not just lower rates... but will lower rates more than once this year [which is stupid and Powell knows it.]


    Here is an interesting news article that explains this further:


    Here's why the Fed's coming rate cut makes no sense

    https://finance.yahoo.com/news/why-f...174010496.html



  2. #2
    Join Date
    Mar 2010
    Location
    Born on a Mountaintop
    Posts
    9,847

    Default

    Below true market rates are the only thing keeping this economy going..

    Cheap money is helping Wall Street more than Main Street.
    Plato once said, “Wise men speak because they have something to say. Fools, because they have to say something.”

    "Fere libenter homines id quod volunt credunt." "Men willingly believe what they wish to believe."
    Julius Caesar

  3. #3
    Join Date
    Apr 2017
    Posts
    2,173

    Default



    Maybe the baby-boomers have reduced their spending [I know I have.]

    In a consumer-driven economy, TPTB need the masses to buy, buy, buy... even on credit and in spite of already sky-high personal debt.

    Reducing interest rates will entice more people to buy, buy, buy on credit. It will also foster them buying already over-priced real estate and other commodities... creating bubbles to burst down the road [including the way overpriced stock market !]



  4. #4
    Join Date
    Mar 2010
    Location
    Born on a Mountaintop
    Posts
    9,847

    Default

    Credit card rates haven't dropped.
    They're still 15-30%.
    These rate cuts will benefit Wall Street more than Main Street
    Plato once said, “Wise men speak because they have something to say. Fools, because they have to say something.”

    "Fere libenter homines id quod volunt credunt." "Men willingly believe what they wish to believe."
    Julius Caesar

  5. #5
    Join Date
    Apr 2017
    Posts
    2,173

    Default



    Powell lowering interest rates will also entice *greater fools* to chase higher yields and returns into the already historically high stock market. After all, the powerful wealthy elite who may realize a collapse is coming... needs *greater fools* to buy their over-priced stocks.

    https://en.wikipedia.org/wiki/Greater_fool_theory


  6. #6
    Join Date
    Sep 2009
    Location
    Slave Region 10
    Posts
    66,254

    Default

    The Illusion of the Keynesian Multiplier

    Mises.org - July 15, 2019 -
    Not only will easy money policy not lift production, it will impoverish us be inflating away real wealth
    They swore, if we gave them our weapons, that the wars of the tribes would cease.
    "You think a wall as solid as the earth separates civilisation from barbarism. I tell you the division is a sheet of glass."
    John Buchan, 1st Baron Tweedsmuir of Enfield (1875-1940): Author and Diplomat

  7. #7
    Join Date
    Apr 2017
    Posts
    2,173

    Default



    Below is an interesting news article from 2016 [not sure the link is still good]

    Japanese author Kiyosaki wrote a book in 2002 that said when the first wave of baby boomers turn 70 1/2 in 2016 and must take the mandated RMD from their tax-deferred accounts it will negatively affect the stock market.

    Ironically....

    This well-known Japanese author, Kiyosaki,
    also co-authored another book with Trump !


    Why We Want You to Be Rich: Two Men - One Message - 2006

    by Donald J. Trump and Robert T. Kiyosaki


    Trump also turned 70 in 2016... like the baby boomers mentioned in Kiyosaki's book.


    'Rich Dad' author says the 2016 market collapse he foresaw in 2002 is coming

    *

    " In 2002, Kiyosaki wrote that the stock market would crash in 2016 as the first wave of baby boomers began to hit 70 1/2 in 2016 and started taking required-by-law distributions from traditional individual retirement accounts.

    He still believes that: "Demography is destiny."

    According to U.S. Census Bureau data, more than 76 million individuals were born between 1946 and 1964; researchers at the Population Reference Bureau determined in 2014 that 65 million of them were still living. After immigrants are added in, according to that 2014 report, the number of living U.S. baby boomers was back above 76 million.

    "Interest income or cash flow on savings is virtually nonexistent, and capital-gains plays in the stock market are thwarted because stock prices are at record highs," he said.

    Whatever burden millions of boomers might put on the market, he said, the situation is being made worse by events overseas, where one big country is wielding the monkey wrench.

    " China has been in a bubble for 20-something years," said Kiyosaki. " It has propped up the U.S. economy falsely. When [China] stops importing, the world crashes with them. "



    more at link

    http://www.marketwatch.com/story/ric...ing-2016-03-23


    August 2018 Trump issued an Executive Order to research raising the RMD age !

    June 2019 the House overwhelmingly and bipartisanly passed a bill [SECURE Retirement Act] that does raise the RMD age a couple of years !

    But this month, stupid Senator Ted Cruz put a hold on that bill which may kill it in the Senate !!


    Also ironic is Trump's current trade war with China !!



  8. #8
    Join Date
    Oct 2009
    Posts
    5,741

    Default

    Quote Originally Posted by Davy Crockett View Post
    Below true market rates are the only thing keeping this economy going..

    Cheap money is helping Wall Street more than Main Street.
    I agree..With the amount of money this administration is spending and keeping interest rates at almost nothing anyone who thinks Trump is looking out for anyone but the elite should think hard about their feelings on that.

  9. #9
    Join Date
    Nov 2007
    Location
    further back in the holler than i was last week
    Posts
    1,028

    Default

    Quote Originally Posted by Davy Crockett View Post
    Below true market rates are the only thing keeping this economy going..

    Cheap money is helping Wall Street more than Main Street.
    this is it! all the QE's have done straight into the market! thats why its at its all time high!
    ===============================
    you can't explain crazy 'cause crazy's crazy!!
    just cause youre paranoid doesnt mean they aint after you!
    Veritas vos liberabit

  10. #10
    Join Date
    Oct 2009
    Posts
    5,741

    Default

    Quote Originally Posted by kytom View Post
    this is it! all the QE's have done straight into the market! thats why its at its all time high!
    QE is still in play today. I'm not saying there's a better choice out there,because there isn't..But Trump is pushing policies to keep this illusion of a bustling economy going.Just another snake oil salesman from what I can see..

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •