stocks, interest rates, etc.
1 response | 0 likes
Started by bear - June 23, 2021, 2:42 p.m.

https://quotes.fidelity.com/ftgw/fbc/ofquotes/mmnet/Charts?SID_VALUE_ID=.IRX&navBar=true

short term rates are rising.  will the markets force the fed to raise rates any time soon?

remember, the norm is for stocks to keep rising until we get an inverted yield curve.  

i believe stocks to be grossly overpriced. (far too expensive).  but markets normally do not crash until the curve inverts.  

long rates are still up above 2% , and short rates are just coming off 0% .   but we are not yet close to inverting.  

Comments
By wglassfo - June 24, 2021, 11:49 a.m.
Like Reply

I agree on your stk market out look, but think the market will remain elevated for at least the rest of this yr. I doubt the Fed slows asset purchases this yr.

I think the Fed would have a hard time increasing int rates above 1 % I think the Fed will continue to insist inflation is transitory as higher int rates affect int paid by the gov't and eventually increasing the deficit, as the real reason to not increase int rates by very much.

The easier route to take is to let inflation continue, the dollar becomes worth less and not raise int rates, especially more than 1 %

My guess that is what the Fed will do

Not saying this is the correct route for the Fed but the easiest

I don't think we have seen the end of high inflation increases but sadly I think inflation will hit the consumer very hard

So long as the container ships remain back logged at both ends, china and NA. Demand will out pace supply. Throw in a chip shortage and steel prices and inflation continues, the dollar buys less

I don't think the Fed has what it takes to fight inflation with 2 % int rates