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Will the Fed ever be able to raise interest rates to a historically normal level again?
Posted on 7/31/19 at 6:55 pm
Posted on 7/31/19 at 6:55 pm
nm
This post was edited on 5/21/20 at 2:02 pm
4
Posted on 7/31/19 at 7:04 pm to sacrathetic
When inflation starts testing us again they’ll raise the rates. The same thing happened in the 80’s.
Posted on 7/31/19 at 7:04 pm to sacrathetic
The 10 yr treasury has fallen below 4% only 2 other times in our history. Both times it took 30+ years to climb back above 4%.
Posted on 7/31/19 at 7:13 pm to Shepherd88
Excellent
Posted on 7/31/19 at 7:33 pm to Shepherd88
quote:So in the Fed’s 106 year history more than 60 of those years the 10-yr yield has been under 4%. Doesn’t that mean rates today are sort of “normal”?
The 10 yr treasury has fallen below 4% only 2 other times in our history. Both times it took 30+ years to climb back above 4%.
Posted on 7/31/19 at 7:59 pm to LSURussian
I forgot who I listened to recently but he made the point that the high interest rates in the 80’s were an anomaly.
Therefore if you take that info in account, yes we are in a normalized interest rate environment currently.
Therefore if you take that info in account, yes we are in a normalized interest rate environment currently.
Posted on 7/31/19 at 8:20 pm to sacrathetic
Not unless there is a massive paradigm shift. Central Banks are backed into a very tight corner.
Posted on 7/31/19 at 8:45 pm to Decisions
The answer is yes. The question is when. I think global trade and technology has caused the CPI’s “basket of goods” to remain cheap. The discount factors mentioned above have been greater than or equal to the inflationary factors so inflation has been well controlled.
In my opinion, rates will rise when global trade and technology comes to a point of maximum efficiency relative to the so called “basket of goods”. If I had to guess - a few decades, if not longer.
Despite recent nationalism trends, I feel we are still in the early stages of the new tech-based, global economy.
In my opinion, rates will rise when global trade and technology comes to a point of maximum efficiency relative to the so called “basket of goods”. If I had to guess - a few decades, if not longer.
Despite recent nationalism trends, I feel we are still in the early stages of the new tech-based, global economy.
Posted on 7/31/19 at 9:10 pm to sacrathetic
Lmao they just effectively monetized $3.9 trillion in debt by ending QT and y'all think inflation has remained low? Rates will never normalize because of government spending. We will never see deficits lower than they are now, so rates can never rise so corporations and government's can keep rolling debt into the future.
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