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re: Soft landing: Did the Fed really somehow achieve the impossible?
Posted on 12/17/23 at 12:06 pm to I Love Bama
Posted on 12/17/23 at 12:06 pm to I Love Bama
quote:
Market is pricing in 5 or 6 rate cuts next year. Think about that objectively. In my opinion, that means something broke. If that happens, does inflation come roaring back?
Not necessarily. The idea is to keep monetary policy relatively restrictive. The key is relative. If inflation is 3% next year, a federal funds rate of 3.5% is still restrictive on a relative basis.
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Posted on 12/17/23 at 12:42 pm to jimjackandjose
Chick-fil-a delux chicken meal cost over $10 dollars. I was shocked and will not be doing that again.
Posted on 12/17/23 at 1:00 pm to euphemus
I was sceptical that it could happen but it’s certainly looking like better than 50/50 that we get back on track with no recession
Posted on 12/17/23 at 1:33 pm to euphemus
Absolutely not.
We are in the calm before the storm.
Forex markets have been a little wild lately.
We are in the calm before the storm.
Forex markets have been a little wild lately.
Posted on 12/17/23 at 2:56 pm to slackster
Yes, I really want chips and other goods to go back to better consumer pricing. Yes the economy may suffer but I'll take suffering in the short term for long term betterment.
Posted on 12/17/23 at 3:01 pm to Civildawg
History shows that about 9-12 months after the Fed pivots (QUICK RATE CUTS) the market will crash.....again.
The best course of action would be for the FED to do nothing quickly and get several QTRs of data and then cut periodically with pauses in between.
The best course of action would be for the FED to do nothing quickly and get several QTRs of data and then cut periodically with pauses in between.
Posted on 12/17/23 at 3:02 pm to oneg8rh8r
I agree but they are so eager to go back to cheap money that it won't happen
Posted on 12/17/23 at 4:36 pm to euphemus
The economy hasn’t crashed because it’s being funded by debt - consumer and government.
If we ever have to pay the bill spending is going to fall off the table.
If we ever have to pay the bill spending is going to fall off the table.
Posted on 12/17/23 at 4:46 pm to ItzMe1972
quote:
Paused the inflation fight till after the 2024 election.
And once the election is over it will be kicked into overdrive.
Posted on 12/17/23 at 6:03 pm to jimjackandjose
quote:
A bag of potato chips is 6 bucks
They fill half the bag with air now and slap on a new and improved flavor sticker. The new and improved flavor is supposed to make us happy with this transaction though.
This post was edited on 12/17/23 at 6:07 pm
Posted on 12/17/23 at 7:55 pm to slackster
quote:
I’m not sure why some people on this board seem to think prices going down is good for the economy.
I have eaten at a breakfast place for years, generally getting the same thing every time. The other day my two eggs, bacon, hash browns and OJ came to $19 and change. $24 and change with tip. It wasn’t that long ago that the whole thing cost $15 or less. This is everywhere, including the grocery store. This is killing the working class. Our currency is being debased and it isn’t getting better.
Posted on 12/17/23 at 10:25 pm to SloaneRanger
quote:
have eaten at a breakfast place for years, generally getting the same thing every time. The other day my two eggs, bacon, hash browns and OJ came to $19 and change. $24 and change with tip. It wasn’t that long ago that the whole thing cost $15 or less. This is everywhere, including the grocery store. This is killing the working class. Our currency is being debased and it isn’t getting better.
It just shows a fundamental misunderstanding of how monetary policy works in this country.
I don’t want 3%+ inflation anymore than the next guy, but I’ll take it over deflation every single day of the week.
Posted on 12/17/23 at 10:34 pm to slackster
quote:
I don’t want 3%+ inflation anymore than the next guy, but I’ll take it over deflation every single day of the week.
Yeah, true deflation brings its own set of problems. And modest inflation over time is fine. Maybe even the best case. But modest inflation isn’t what we’ve been dealing with.
Posted on 12/17/23 at 11:01 pm to SloaneRanger
We are the world’s leader in oil production, and nearly lap the field in terms of gas production.
Yet, we are not a petrostate. The US economy is just incredibly diversified and resilient. And our entire culture is consumption. People in the US don’t leave their residence and return without spending any money.
If the US consumer stays confident the rocket may not even bother landing at all in 2024.
Yet, we are not a petrostate. The US economy is just incredibly diversified and resilient. And our entire culture is consumption. People in the US don’t leave their residence and return without spending any money.
If the US consumer stays confident the rocket may not even bother landing at all in 2024.
Posted on 12/18/23 at 5:27 am to euphemus
They might have pulled off the impossible, but you have to be in one of two camps, right now. First, they are threading the needle by lowering rates prior to breaking something significant; or secondly, they know what’s coming is really bad, and they are getting out in front of it…. This just feels weird, really weird. Uncertain times ahead…..
Posted on 12/18/23 at 6:00 am to euphemus
Lmao you realize every major market correction and hard landing occurred after the first rate cut following a tightening cycle. This is far from over.
Posted on 12/18/23 at 7:11 am to SloaneRanger
quote:
Yeah, true deflation brings its own set of problems. And modest inflation over time is fine. Maybe even the best case. But modest inflation isn’t what we’ve been dealing with.
My point in this thread has been to say we don’t want deflation. Period. I never suggested we should be happy with the inflation we’ve seen - far from it - but we really don’t want broad prices going down over any meaningful time frame.
Posted on 12/18/23 at 7:27 am to euphemus
It’s actually hilarious anyone thinks that who has ever lived through any of the fed’s “soft landing” plans.
They’ll crow about how great they are for about a year, then realize they fricked up and just blame someone else when the chickens come home to roost.
Then it starts all over again. Sometimes the best thing they can do is nothing, which they’re incapable of.
They’ll crow about how great they are for about a year, then realize they fricked up and just blame someone else when the chickens come home to roost.
Then it starts all over again. Sometimes the best thing they can do is nothing, which they’re incapable of.
Posted on 12/18/23 at 7:57 am to lynxcat
quote:
Nah, inflation is slowing down…just not to 2% yet.
Let’s say it gets to 2% or even lower. What about the current price levels do you think are sustainable? Wages have nowhere near kept up with inflation. For the most part, wages have increased for the lower sector or entry level employees. Now employers are paying higher wages for workers that are just as likely to cause problems as they are to generate revenue. Credit card debt is high and people are depleting the savings they’ve accrued over the last 5-10 years. It’s only a matter of time before most things become unaffordable for regular folks. People need a home, a vehicle, and food, all of which are way too expensive at this point.
Posted on 12/18/23 at 8:55 am to euphemus
We will see how layoffs go for the next six months before we celebrate. Historically, when the Fed lowers rates they were late in doing so and it was painful.
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