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U.S. inflation, labor market data bolster Fed December rate hike
Reuters ^ | November 17, 2016 | Lucia Mutikani

Posted on 11/17/2016 11:56:49 AM PST by Sam Gamgee

WASHINGTON (Reuters) - U.S. consumer prices recorded their biggest increase in six months in October on rising gasoline costs and rents, suggesting a pickup in inflation that potentially clears the way for the Federal Reserve to raise interest rates in December. Prospects for a rate hike next month also got a boost from other data on Thursday showing first-time applications for unemployment benefits tumbling to a 43-year low last week and housing starts surging to a nine-year high in October. The reports painted an upbeat picture of the economy early in the fourth quarter and came as Fed Chair Janet Yellen told lawmakers that the U.S. central bank could lift borrowing costs "relatively soon." "Today's data give the Fed more evidence to support a rate hike next month," said Alan MacEachin, corporate economist with Navy Federal Credit Union in Vienna, Virginia. "The only thing standing in the way at this point would be a disastrous jobs report in early December, a remote possibility at best."

(Excerpt) Read more at finance.yahoo.com ...


TOPICS: Business/Economy
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Trump is so lucky to have inherited a strong economy? Does anyone believe this anymore?
1 posted on 11/17/2016 11:56:49 AM PST by Sam Gamgee
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To: Sam Gamgee

They are obviously manufacturing the data so that they can justify a rate hike which is something that they should have been doing ride-alongs but didn’t because Obama would have none of it.


2 posted on 11/17/2016 12:01:54 PM PST by billyboy15 (L9)
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To: Sam Gamgee
This is so much bullshit

They obviously want to slam Trump with a rate increase after covering for Obama for the last eight years.

3 posted on 11/17/2016 12:03:40 PM PST by rdcbn ("There is no means of avoiding a final collapse of a boom brought about by credit expansion. The alt)
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To: Sam Gamgee

Inflation? People on S.S. just got a 0.3% raise because there has been no inflation, according to the government.

Labor market? What labor market? You mean the labor market that increased the number of idle people by over 200,000 last month?

Those stats out two massive bogus excuses for raising interest rates.

Where were the people demanding increases in the interest rate over the last eight years? We had inflation and jobs figures identical to now, for at least the last three.

What this is, is an attempt to create a headline where something negative can be attributed to Trump.


4 posted on 11/17/2016 12:03:55 PM PST by DoughtyOne (The morning and the evening were the election day. People voted. The Lord saw, and it was good.)
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To: rdcbn

Remember, I am the guy that has been saying we will be punished for months.

That said, think about it. The market is not based on reason. It is emotion. Everyone “knew” the Obama economy was too fragile to withstand a rate hike or an end to QE. Now just the PROMISE of Obamanomics coming to an end is putting strength back into the economy.


5 posted on 11/17/2016 12:13:01 PM PST by wastoute (Government cannot redistribute wealth. Government can only redistribute poverty.)
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To: Sam Gamgee

I’m sure if Hillary was elected they would have left interest rates as is. Now that Trump’s elected they need to pop the market bubble and fast. Notice, they only increased rates once through Obama’s reign. You think the Fed is non-partisan - what a joke. Get rid of it.


6 posted on 11/17/2016 12:32:20 PM PST by ProudDeplorable
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To: wastoute
wastoute :" Everyone “knew” the Obama economy was too fragile to withstand a rate hike or an end to QE "

Everybody knows that the Obama economy is a LIE !
The economy is as honest as the press/ media that has reported on Trump
Joe Wilson was right : "YOU LIE ! "

7 posted on 11/17/2016 12:45:03 PM PST by Tilted Irish Kilt
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To: rdcbn
Yes, bullshit all around. The jobless claims is BS. And so is the narrative that “Trump is inheriting a robust economy”. Who believes that? I don't believe it? Right now we are in Bizarro world with the markets. The bond market is seeing yields rise on Trump's election? What nonsense. I think the yield increases will peter out and come back to reality.
8 posted on 11/17/2016 12:48:08 PM PST by Sam Gamgee
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To: DoughtyOne

I agree. No one, except pensioners would like to see rate increases. Yes, where were they the last 20 plus years with a declining yield rate? Just more attempts to tie economic numbers to Trump. He is not even President yet for goodness sake. No ones has any clue on his monetary policy, if he even has any yet?


9 posted on 11/17/2016 12:50:06 PM PST by Sam Gamgee
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To: rdcbn

A December rate hike has been expected for months.


10 posted on 11/17/2016 12:50:17 PM PST by mlo
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To: ProudDeplorable

There are so many interests, Wall Street especially, that need rates to stay low. I can’t imagine trying to discredit a President-elect is worth the carnage from rate hikes...


11 posted on 11/17/2016 12:51:49 PM PST by Sam Gamgee
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To: Sam Gamgee

Here comes the economic sabotage.


12 posted on 11/17/2016 12:53:59 PM PST by fella ("As this was before Noah so shall it be again,")
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To: Sam Gamgee

I would say pensioners AND those seeking to create wealth for their own futures. And there’s nothing wrong with that.

It isn’t right that people put their money in bank accounts that yield a fraction of 1%, and then pay credit card fees of over 20%.

Joe Citizen is getting hosed and we all know it.

And if ole’ Joe dares make one late payment, he can find himself paying 30% interest on his cards.

That is what was customarily termed loan sharking in the old days.

Short term demands to pay aren’t the only types of loan sharking. These rates are criminal in nature.


13 posted on 11/17/2016 12:56:21 PM PST by DoughtyOne (The morning and the evening were the election day. People voted. The Lord saw, and it was good.)
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To: Sam Gamgee

The yields and mortgage rates are increasing because people are moving money into stocks in the belief that cutting the corporate tax rate to 15% will cause after-tax corporate profits to rise.

Remember after Apple pays Ireland 14% and that 14% gets credited against a 15% US tax rate, the US Treasury will only get 1%.

A 15% corporate tax rate will cut US corporate tax revenue by about 40%.

“Almost half of all federal revenue (47 percent) comes from individual income taxes.”

“Corporate income taxes make up about 11 percent of federal revenue.”

http://www.cbpp.org/research/policy-basics-where-do-federal-tax-revenues-come-from


14 posted on 11/17/2016 12:56:32 PM PST by Brian Griffin
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To: Sam Gamgee

We all knew the fed would raise the rates to screw Trump if he was elected and guess what?-)


15 posted on 11/17/2016 12:57:10 PM PST by Harpotoo
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To: Tilted Irish Kilt

I have been thinking there would be a buying opportunity as the market transitions emotionally from Zero to Trump. Now, I am not as sure there will be. The strength of the expectation of Trump may just pull right through. I am sure the BSM will do their best to talk the economy down but their credibility is lower than whale crap so they probably won’t have much impact.


16 posted on 11/17/2016 12:58:42 PM PST by wastoute (Government cannot redistribute wealth. Government can only redistribute poverty.)
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To: Sam Gamgee

The Federal Reserve has gotten very corrupt.

This is political. It needs to be dealt with.

I would suggest:

By federal law, the Federal Reserve might only buy the following:
1. US government debt
a. when household unemployment is above 6%, but no more than $1 billion/month per 1/5th percentage unemployment above that 6%, less 2% per month of purchasing in the past ten years
[at 12% unemployment, it could initially buy $30 billion of debt a month, but after 50 months of buying, it could buy none]
b. at (2% plus the last official inflation rate>0) at 10-year US bond auctions
c. at (1.5% plus the last official inflation rate>0) at shorter term auctions so US debt needs will always be fulfilled
2. state full-faith and credit debt in certain circumstances
at 1% higher rates, but no more than 5% of any state’s outstanding debt


17 posted on 11/17/2016 1:03:30 PM PST by Brian Griffin
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To: Sam Gamgee

Amazing how everything instantly changes.


18 posted on 11/17/2016 1:05:58 PM PST by kaehurowing
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To: DoughtyOne

I whole heatedly agree. I am completely against “managing” interest rates for the benefit of borrowers at the expense of savers. It encourages a cult of consumerism, and is anti-Capitalistic in my opinion. Rates should be free to find levels in a free market.


19 posted on 11/17/2016 1:10:17 PM PST by Sam Gamgee
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To: Brian Griffin

Interesting. So this may be more than just a short term blip? What happens when the bond market move in a different direction than where the Fed wants to be? Who will win?


20 posted on 11/17/2016 1:13:06 PM PST by Sam Gamgee
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