Author Topic: Fed raises rates  (Read 12341 times)

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Offline eyephone

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Re: Fed raises rates
« Reply #15 on: February 19, 2016, 07:18:55 AM »
All the moves that Janet made back fired. I think Janet doesn't know what she is doing.

Offline Bullsback

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Re: Fed raises rates
« Reply #16 on: February 19, 2016, 09:03:15 AM »
No, I think the fed's job isn't necessarily to do long-term manipulation of rates, etc. The whole point of QE was to provide medicine before the congress could enact real legislation to solve some of our woes. Instead, all we've had is 6+ years of congress doing nothing. Nobody willing to reach across the aisle, even when things legitimately make sense and both parties agree, they still won't do anything.

It is beyond pathetic. 

PS: What can the fed do when the rest of the world is in utter chaos. The hardest part of all of this is, we are a global economy and while the US economy is actually on pretty good footing and supportive of rate increases, the reality is, the rest of the world's central banks don't work with / talk with the US and thus we are going to be in this tough spot where it will be very difficult to raise rates given when it is going on in Europe and Japan.  It will ultimately drive significant volatility in rates and also continue to drive increased equity volatility as well (if not worse equity volatility). 

Offline irvinehomeowner

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Re: Fed raises rates
« Reply #17 on: February 19, 2016, 09:07:03 AM »
So in simpleton's (my) terms, what does this mean?

Are mortgage rates going rise like many have been predicting since 2008?
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Offline Bullsback

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Re: Fed raises rates
« Reply #18 on: February 19, 2016, 10:09:45 AM »
So in simpleton's (my) terms, what does this mean?

Are mortgage rates going rise like many have been predicting since 2008?
Nothing would indicate any drastic move in mortgage rates in the next 1 to 2 years. I say "drastic", they certainly could move 50-75 basis points (with a higher range on the upside than the downside) but in general, I would be stunned to see rates above say 4.25 a year or two years from now. Economic conditions wouldn't seem to allow it.

In my most layman terms, how could you justify US Treasury rates and ultimately bank lending rates in the US to be significantly higher then the rest of the world. For example, if we raise rates, all that will do is further increase demand for actual US Treasuries, thus pushing down our treasuries even lower (this is what will drive volatility as fed clearly would like to raise rates). If you were in Europe or Japan, would you rather borrow at negative interest or buy US treasuries with some return (and I'd also argue a hell of a lot more safety)? 

Fed has also been wrong on the downside of its economic growth assumptions every year since 09 I believe.  Its normal to be wrong, but it is not normal to be wrong that often the same way. 

Online morekaos

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Re: Fed raises rates
« Reply #19 on: February 19, 2016, 10:40:17 AM »
Having said all that, I agree with the bulk, however, I think the underlying economy is stronger than it is give credit for and on that respect the Fed has chosen a course that barring unforeseen disaster (Nuke terrorist hit domestically) I think they will stick to rate hikes over the next year.

Fed's Loretta Mester: Economy still 'strong,' 'gradual' rate hikes likely

http://www.cnbc.com/2016/02/19/feds-loretta-mester-economy-still-strong-gradual-rate-hikes-likely.html


Online morekaos

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Re: Fed raises rates
« Reply #20 on: March 04, 2016, 11:31:38 AM »
More fuel to the fire....

http://www.cnbc.com/2016/03/04/blackrock-jobs-report-takes-pressure-off-fed.html

Ex-Fed Plosser: Big rate catch up may be needed

"So there may be rate hikes, but maybe one or two of them might be 50 basis points, instead of 25 [basis points]," said Plosser, a monetary hawk who served 8½ years as head of the Philadelphia Fed before retiring last March.


"I think the markets need to anticipate that being data dependent means the Fed may have to catch up," Plosser added.

Offline eyephone

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Offline USCTrojanCPA

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Re: Fed raises rates
« Reply #22 on: December 14, 2016, 12:20:31 PM »
Fed raises rates.

https://www.bloomberg.com/news/articles/2016-12-14/fed-raises-rates-boosts-outlook-for-borrowing-costs-in-2017

It's no surprise that they raised rates, but the fact that they think that "inflation expectations have grown considerably" has given the stock market a little heartburn at the moment.
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Online morekaos

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Re: Fed raises rates
« Reply #23 on: December 14, 2016, 12:30:18 PM »
Just a pause. Three more coming at least. All good.

Online morekaos

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Re: Fed raises rates
« Reply #24 on: December 14, 2016, 12:40:28 PM »
Relax everybody police action was inevitable and as it so happens necessary....Yippe kay ye....


Offline Soylent Green Is People

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Re: Fed raises rates
« Reply #25 on: December 14, 2016, 01:21:54 PM »
Yes, I know 10YR T isn't tied to loans, but an easier indicator than MBS prices....

AM - 10YRT at 2.45, down from 2.48 last night
After FED - 10YRT at 2.56 (1:15 PST)

MBS's which were green prior to Fed move, now -20bps.

All in all about +.375 in rate from AM pricing to PM re-prices for the worse once the dust settles today. (IMHO)

SGIP

Offline Compressed-Village

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Re: Fed raises rates
« Reply #26 on: December 17, 2016, 07:51:48 PM »
Bring on the higher rate. I WELCOME it......Yikes, don't shoot me.

Offline YellowFever

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Re: Fed raises rates
« Reply #27 on: December 27, 2016, 05:36:54 PM »
.
« Last Edit: April 21, 2017, 11:44:38 PM by YellowFever »

Offline USCTrojanCPA

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Re: Fed raises rates
« Reply #28 on: December 27, 2016, 06:26:28 PM »
Yeah I hope Fed raises the rates so mortgage rates go up to 5-6% on a 30year fixed.  That'll bring down the home prices.


Which will also cause a recession which will in turn have rates right back to 0% (when I'll refi into another ARM loan) and housing going back up.  I would be interesting to see what kind of impact mortgage rates going to 5-6% on real estate prices though.
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Offline daedalus

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Re: Fed raises rates
« Reply #29 on: December 27, 2016, 07:30:37 PM »
IMO price drops will trail the perception of rising future rates, just as the perception of deflation stymies consumer spending.  So short term, the perception of rising rates will fuel an increase in the willingness to pay, but long term, as rates actually do rise, prices will have to fall.

 

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