US Federal Reserve still expected to raise interest rates

The Irish Times ^ | Wed, Aug 26, 2015 | Simon Carswell

[expat_panama]

China’s stuttering economy might come more strongly into view from the Rocky Mountains at this week’s Jackson Hole meeting of central bankers following the chaos in the stock markets.

Many economists still expect the Federal Reserve to stay the course and start raising interest rates this year.

Despite the wild see-sawing of US stocks after China’s “Black Monday” meltdown, the bet is on the central bank to move soon and start weaning the US off rates that have stayed near zero since 2008.

The annual policy conference in the Grand Teton National Park in Wyoming, starting onon Thursday, has traditionally been a forum for chin-stroking academic ruminations.

Despite the 6,000ft altitude, there has been plenty of hot air at the symposium since it moved to Jackson Hole in 1982, four years after its inception.

In more recent times, Fed chairmen Alan Greenspan and Ben Bernanke used the mountain retreat to signal major policy shifts.

Fed chairman Janet Yellen is not travelling to Jackson Hole this year but markets will be following closely...

[snip]

...Fed’s policy-making committee would raise rates for the first time since 2006 when it meets in mid-September. Minutes of the committee’s July meeting, released last week, said the right conditions for a rate increase “were approaching.”

Employment numbers There is still plenty of data to come before the September meeting – economic figures on Thursday and employment numbers next week – that the Fed will peruse. The decision to raise rates will rest on whether labour market conditions are still improving and whether the Fed is confident inflation is heading towards the target rate of 2 per cent.

Employment growth has picked up and the creation of, on average, 240,000 new jobs every month for two years has left the unemployment rate at a healthy 5.3...

[citizen]

....central bank to move soon and start weaning the US off rates that have stayed near zero since 2008.

Ya want weaning, eh? Raise a full point and start paying us savers some cash!

[Lurkina.n.Learnin]

That would certainly make a statement.

[Flick Lives]

Fed members think they’re Masters of the Universe, plotting out the course of the economy. They can’t let reality intervene in their plans. They have to raise rates because to not raise rates would be admitting they are not omniscient and in control.

[CPT Clay]

Not my expectations. Turmoil has put Sept raise on hold.

[citizen]

...has left the unemployment rate at a healthy 5.3

Ok, I need to hear no more from this guy. Nothing about US employment is healthy. Very little is even at a minimum standard.

[WKUHilltopper]

The economy sucks with zero interest rates. What better way to kill off the country?

We need to get rid of this criminal element, the Federal Reserve.

[Jack Hydrazine]

Not gonna happen unless the Fed wants to crash the whole system.

[expat_panama]

Good Morning!  OK, so stocks hit new lows yesterday but  today's futures (indexes +0.95% metals -0.885) say it's always darkest before the dawn  and there'll be a brighter day tomorrow --just like they did yesterday morning.  Maybe it's the expected announcements about the wonderful econ recovery:

7:00 AM MBA Mortgage Index
8:30 AM Durable Orders
8:30 AM Durable Goods -ex transportation
10:30 AM Crude Inventories

--or it's all the news headlines:

Get a Grip, Stock Markets Are a Little Nutso - Allan Sloan, Washington Post
Does the Plunge Signal Death of Retail Investor? - Doug Kass, TheStreet
China's Losing Battle to Save Its Stocks - Brendon Hong, The Daily Beast
What Does the Market Collapse Mean for Rates? - Ben Wright, Telegraph
Has the Fed Missed Zero Rate Exit Ramp? - Tad Rivelle, RealClearMarkets
Bets That Fed Will Delay Could Be Premature - Binyamin Appelbaum, NYT
The Deeper Dread Lurking Behind the Sell-Off - Annie Lowrey, New York
Hot Tech Start-Ups May Face a Bumpy Fall - Katie Benner, New York Times
Don't Try To Be a Hero In This Stock Market - Kevin Marder, MarketWatch
Key Takeaways From Stock-Market Meltdown - Simon Constable, Forbes
Emerging Economies A Long Way From Eclipsing West - Guy Sorman, CJ
A Key to Increasing Economic Mobility - Ron Haskins, RealClearMarkets
Wealth Redistribution Can't Fix Inequality - James Piereson, Commentary
Trump & Sanders Fall For the Oldest Econ. Fallacy - Don Boudreaux, FEE
Falling Stocks Boost Odds of Trump Presidency - Charles Gasparino, NYP

or FR threads:

• The Struggle for Economic Liberty
• China's Rate Cut Failed To End The Market Chaos
• As Minimum Wages Rise, Restaurants Say No to Tips, Yes to Higher Prices

[citizen]

wants to crash the whole system.

Sometimes I believe that the O Regime really is working the Cloward–Piven playbook.

[expat_panama]

start paying us savers some cash!

lol!!!  I'd totally forgotten that the primary purpose of the fed was to give you money and here all this time I thought their goal was stable dollar prices. 

[Lurkina.n.Learnin]

Here’s one to add to your reading list.

Monday’s Market Plunge Hit Some ETF Investors Hard
http://blogs.wsj.com/moneybeat/2015/08/25/mondays-market-plunge-hit-some-etf-investors-hard/

“But it wasn’t fine for everybody. Those who ran into trouble would be those who had orders in place to sell an ETF that fell by a certain percentage. Such orders may have been executed at a price much lower than even where the order kicked in as shares fell quickly, he says.”

[grania]

start paying us savers some cash!

I don't think we're atypical. 0% interest on savings is destroying those who want to responsibly manage their economic situation and future.

[palmer]

About five years too late. Part of the reason China is tamking is rates left too low for too long resulting in a bubble there that is now popping. The next stage of easing will be more printing for QE purchases or walking-around money.

The problem now is that the credit pricing distortions are ingrained and there will be a large economic shock when removing them.

[IYAS9YAS]

Employment growth has picked up and the creation of, on average, 240,000 new jobs every month for two years has left the unemployment rate at a healthy 5.3...

Yeah. Right. I have to learn to quit reading articles like this while drinking things.

[expat_panama]

Turmoil has put Sept raise on hold.

What you're saying makes perfect sense, even to me.  My problem is seeing too many things going on these days that just don't make any sense.  I mean, the world's in melt-down and the hired help isn't even bothering to show up for work:

Fed’s Yellen Plans to Skip This Year’s Jackson Hole Conference
Janet Yellen, other big names, no shows at Federal Reserve summit in Jackson Hole
Yellen, other big names, no shows at Fed summit in Jackson Hole

[expat_panama]

Me too. Took a while to clean up my keyboard w/ all the coffee spit on it when I read that.

[citizen]

I'm glad you remembered!
As for the stable [petro]dollar, what makes it appear stable is the current belief in the US economy as a safe haven during bad times. People running toward the tallest midget, so to speak.

[meatloaf]

It will be interesting. Greenspan admitted the Fed caused the Great Depression when it raised interest rates.

[Bubba_Leroy]

One way for Obama to declare martial law and emulate his idols Stalin, Castro and Chavez as president for life is to crash the economy first.

I’m not saying that is what he is planning, just thinking out loud.