Many unaccountable economist say anything, but FED is the team accountable for US economy and they will do what is good for people. If FED needs to go 5.5% or 7.5%, they will go, but they won’t announce it now (why do they need to raise alarm?) as they need to balance many things.
The profession can alarm anything as he is not accountable for congress. If he is accountable, the same prof keep quiet same way FED is doing !
Regarding investor side, JPM CEO is well known top bank as JPM holds lot of funds & Investments.
It is the way it is, they do not want to derail the economic progress and gave enough time to set it right.
Think of this situation.
You and entire family friends driving on a downhill slope at 120 miles per hour (high inflation), suddenly notice the black ice on the road.
Will you apply sudden brake or will you reduce the speed from 120 to 90 then 90 to 60 and then 60 to 30 and then 30 to 10 miles/hour?
Which one is correct? Simulate this for world largest economy.
Remember even with slow increase year 2008, we had 9 trillion dollar issue with millions of home owners went bankrupt and big banks went to the brink of bankruptcy, but saved by money printing !
Think of a situation, if FED applies straight 10% from 0.25%, MSFT, AAPL, GOOGL and AMZN itself will go into trouble, they will simply cut 80% of workforce, rewind all projects suddenly !
Assume that they are acting now as aggressive as possible with 0.75% (which is very high).
The point is FED is not telling the truth and it seems like both you and I agree that is the case and reasons are immaterial from the point of view of protecting downside risks of our assets.
Random and garbage analogy. The argument goes both ways. Why did Fed overnight reduce the rates to 0 and started QE. Why not gradual. You will say oh there was pandemic and Fed’s mandate is to maintain full employment. Well Fed’s action did not help avoid unemployment. It helped rich get richer and create record asset bubble. And well now there is RECORD inflation which is actually by the way the main Fed’s mandate to avoid. Fed’s real mandate seems like to bail out over leveraged companies not fight inflation. Its the most corrupt organization.
Garbage in garbage out. Many people like you will not understand as this is beyond your mind level.
Correct, FEDs need not tell what they are going to do. Every time FED chair says we are providing as much as clarity possible (implied he may not tell everything).
I do not think they are hacks, There are very smart people and financial experts. The only problem is that they are working for the wealthy and are all bought out. They do not work for ordinary people.
I’m calling them political because they need to keep their bosses happy, i.e. the President re elected.
However in the quest to keep the Progressive wing happy Biden overspent, and now FED can’t do a bitter pill to keep inflation down, specifically before midterms. Problem is after midterms Presidential election is again in 2 years, so there is no good time to have a recession really in terms of political relection for the incumbent party/candidate.
The fed should have started 0.25% hikes a long time ago. They were very late. That’s why we are getting 0.75%. They missed the chance to be gradual, and now they’re slamming in the brakes at a historic pace. They’ve already failed at their job, and now they’re just trying to avoid a massive pileup on the freeway.
Hmmm, I see it affects them too. If it is not affecting them, Why Cathie Cries today or Why Jamie Simon warns today. They are not doing free service, but all they want FED to stop as they feel the pain too !
They’re all insanely wealthy. Their feeling the pain is a LOT different than a median income family paying $5 for gas and much higher grocery and utility bills. You can see it in the decline of savings rate and increase in CC debt. It is crushing to the middle class. The insanely wealthy just delay their private yacht or jet purchase. They aren’t part of the 19% who are behind on rent. That rent number was the ultimate red flag to me on how bad things are getting for people. I 100% missed how bad inflation was impacting the middle class. It’s brutal. Now it’s time to be a ruthless savage and profit from it.
