Posted on 03/09/2022 9:28:44 AM PST by SaxxonWoods
Consumers may soon see the most aggressive Federal Reserve in decades.
Expectations are growing that the U.S. central bank will hike interest rates this year by the most since 2005 as inflation hits a 40-year high. How much depends on who you ask: Goldman Sachs is penciling in seven increases, while traders are betting on at least six, according to CME Group's FedWatch.
Travels World Tour Ad Ad travelworldtourism.com Travels World Tour Fed Chair Jerome Powell at a March congressional testimony also opened the door to a massive half-point increase if price pressures don't settle down, which would be the biggest single rate hike since May 2000.
To make 2022 an even busier year for Fed policy, a number of officials expect to start shrinking their massive portfolio of nearly $9 trillion in bonds by sometime later this year, according to records of the Fed's January meeting.
The ultimate risk, however, is that the U.S. central bank does more harm than good to an economy that's already experiencing its worst inflation since 1982.
(Excerpt) Read more at msn.com ...
“Slam on the brakes! Hike it to 4%. I’d go back to buying T bills. Gets me some of my outrageous taxes back.”
They aren’t going nearly that far but I bought my first short-term treasuries in years recently, with the tax advantage they beat money in the bank. Watching now and will build the ladder as they rise. It will be nice to able to use Treasuries again.
I get the sense the Bond Market will react faster than the banks.
“What’s wrong with deflation?”
Study Japan over the last 10 years to find out.
Deflation kills innovation, risk-taking, business startups, job growth and personal spending, leading to a very dull economy that grinds lower in velocity.
Socialists are good at achieving it.
Could be, we’ll see.
Inflation is like eating.
In moderation it’s good. Overeat, bad.
Deflation is like slowly starving, nothing good about it.
Good discussion, Freepers, people are thinking out there.
It’s time start reacting, good luck with your investing, budgeting, prosperity moves etc.
And as always, see my tagline...
Excellent discussion yesterday—for those who missed it:
https://freerepublic.com/focus/f-news/4044907/posts
Thanks!
I predict two quarter point raises and then they have to retreat. They just raised a quarter point and mortgage rates dropped back to 4.10%.
Place your bets, how many raises, will they have to go up a half-point at once, and what will be the effects?
I’d be raising in line with what the expectations are at this point.
.25+.25+.25 for 2022. This lets everybody know we’re serious about changing away from cheap money stupidity.
.25+.25 for 2023. “Hey speculators, we’re sticking with our new policy.”
.25 for 2024. “Its an election year. We can go either way.”
“A friend of mine insists that they can never be raised that much or we are cooked.”
IMHO: The current goal of the communist left is to DESTROY the USA, hence I believe MASSIVE interest rate increases will ensue...
My Wife’s mother went through a divorce JUST after the Carter years (OK her father did as well but that’s not the point of this story) and she purchased a condo at 18% APR. Why? because that was the rate for 30 year fixed mortgages.
“...or we are cooked.”
THAT IS the aim.
Gird your loins!
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.