The fed should easily have the justification to go with a 0.75% increase now.
Try 1-2% if you are serious Fed.
I still question how much immediate impact it has. Only a very small percent of people are buying homes each year. The bulk of home owners are locked in at a low 30-year rate. It’s more likely to impact car sales which would easily trigger a recession.
Even if you look at corporate and government debt, the bulk is longer dated maturities, so only a very small amount matures each year. The portion of maturing debt that’s re-issued will be impacted, but the rest of it isn’t.
Credit card rates are so high does 1-2% higher really make a difference?
They’re using a method to reduce inflation that takes a very long time to actually impact the economy. Rate cuts are faster, since it creates a home re-finance boom which gives people more monthly disposable income.
The Fed has really stepped in it. Looks they are out bullets and are swimming naked like all the speculative investors they encouraged. Stock holders beware. The rest of us are now along for the ride. Keep an eye on unemployment stats. Housing prices will definitely flatten and could fall if unemployment tops 10%
The fed has been making mistakes for years. All those mistakes were coiling up the spring leading to this moment. I will just keep buying puts on bond ETFs and using the 10-day MA as a stop. Rates are going to have to go much higher than people expect.
Meanwhile house prices keep going up in Tahoe. The 1% still has plenty of money. Tahoe is super cheap for BA investors. Don’t have to get on a plane, be vaccinated or ware a mask. Driving still much cheaper than flying. Air fares in the stratosphere cause RE recessions in place like Mexico and Hawaii
Average sfh in South Lake Tahoe $738k up 17% year over year.
At some point, higher prices have to kill demand which will curb inflation. Who knows when that is though. Americans have zero financial responsibility and will borrow as much as possible. Eventually, there is a limit to borrowing though.
It’ll be OK now though. Biden fixed it:
This guy will sell any snake oil for his re-election. I thought you will hear such rhetoric from Hugo Chavez or his admirer - Bernie Sanders -The man who had written there’s nothing called American dream, but Venezuelan dream is what Americans should aim for.
Ok, this is even dumber than I thought.
Chevon GM which is a good measure of the selling price vs. extraction and refining costs:
Q1 2022 30.6%
Q1 2021 29.7%
Back in 2018 (so long before covid impacts), their GM was 28.2%. Improving their GM from 28.2% to 30.6% is why we have $5 gas? The average gas price in 2018 was $2.74.
Then there’s the issue of comparing their profits to 2020 and 2021 as a baseline when those years had lower demand due to covid restrictions.
Good one 
Brandon’s plan to bring down the cost of gas and food is literally asking gas and food producer to cut the cost of price and food.
Careful. Soon they’ll want to use evil profits as an excuse to turn them into government owned and operated. That way the government can set prices to control the economy.
Getting there…
Perhaps someone should ask Corn Pops why the government is spending well over what they take in, and that too is unacceptable. Unless his Aricept dose has been bumped up lately, don’t expect a cognizant answer.
Here are a couple of “fun” thoughts on inflation:
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Imagine what it will be like in December when the Boomers SSI COLA (Cost of Living Adjustments) kick in at a 9-11 percent more YOY. We’ll be accelerating the outflow of SSI dollars well beyond what can be replaced by Millenniums/Gen X, and Gen Z’s income.
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It’s going to be difficult to “kick the can” down the road much further since US Debt refinancing has been done over and over again at lower and lower rates. Now we are facing at least with government obligations the reverse effect - trying to recapitalize at a much higher rate than before. Something has to give - but what?
This ride is by no means over. Carter’s inflation problems accelerated in 1977. By 1980 when Reagan took over the Prime rate was in the low 20’s. Prime started coming down only a year or so later, so about a 5-6 year start to peak to unwind.
It’s fair to assume based on prior experience, our present rising rate environment is neither transitory or facing some kind of pause in the near term. Hedge accordingly.
Thanks for reading.