Topic For FOMC (Federal Open Market Committee) Meetings

[abhiseshakana]

The vote was 12 - 0, ser. That could also suggest that during the next FOMC meeting on October 28, it might be another 25 bps increase. Kevin Warsh also suggested that they believe that the U.S. economy is strong enough to endure another cycle of tightening.

But personally, they'll overcompensate and PIVOT when the economy starts breaking.

I imagine what's going through Trump's mind right now :

POV TRump

What is the middle ground?

• I needs low interest rates to reduce my government financing costs, whereas the Fed needs high interest rates to curb inflation.
• Politically i need an economy that feels quite strong but Feds said monetarily, economy need disinflation
• I asked FED to cut rates but FED said My policy, making the Fed's job of fighting inflation more difficult such as attacking Iran.

What i think stupid from Trump, like a kid, he want lower rate, strong economy, low inflation, & cheap government financing simultaneously. I think hard to get in the economy condition which inflation is high, big government debt, tarrif pressure and energy shock, So, Warsh's view that the US economy remains quite strong is wellfounded.

In the end i realized that what Warsh was lecturing Trump when he said independence is a two way street which mean It is not only the Fed that must be independent of the government; Trump government must also conduct fiscal and trade policies without expecting the Fed to always bear the consequences.

Can US got both a FED that keeps borrowing costs low as Trump expectation and a remain tame inlation as Warsh requirement at the same time ?

[Wind_FURY]

The vote was 12 - 0, ser. That could also suggest that during the next FOMC meeting on October 28, it might be another 25 bps increase. Kevin Warsh also suggested that they believe that the U.S. economy is strong enough to endure another cycle of tightening.

But personally, they'll overcompensate and PIVOT when the economy starts breaking.

I imagine what's going through Trump's mind right now :

POV TRump

What is the middle ground?

• I needs low interest rates to reduce my government financing costs, whereas the Fed needs high interest rates to curb inflation.
• Politically i need an economy that feels quite strong but Feds said monetarily, economy need disinflation
• I asked FED to cut rates but FED said My policy, making the Fed's job of fighting inflation more difficult such as attacking Iran.

The Federal Reserve's mandates are price stability and employment, then from Kevin Warsh's own viewpoint, he's merely doing his job.

What i think stupid from Trump, like a kid, he want lower rate, strong economy, low inflation, & cheap government financing simultaneously. I think hard to get in the economy condition which inflation is high, big government debt, tarrif pressure and energy shock, So, Warsh's view that the US economy remains quite strong is wellfounded.

In the end i realized that what Warsh was lecturing Trump when he said independence is a two way street which mean It is not only the Fed that must be independent of the government; Trump government must also conduct fiscal and trade policies without expecting the Fed to always bear the consequences.

Can US got both a FED that keeps borrowing costs low as Trump expectation and a remain tame inlation as Warsh requirement at the same time ?

It's a balancing act between tightening and easing, and currently it's tightening. But I'm very confident that there's a high probability that the Federal Reserve will tighten too long and break the economy. THAT'S when they need to turn on the money printer to stimulate the economy.

Follow the Unemployment Rate. If that surges over 6%, the Federal Reserve will start to suggest that they will ease "soon".

[Wind_FURY]

The latest data for unemployment was released this week, and it was slightly higher than expected. It was 4.2% higher from the expected 4.1%, WHICH is actually a little "bullish" for the market.

It indicates that the Federal Reserve might be forced not do another rate hike during the FOMC meeting at the end of the month.

  👀

[Wind_FURY]

The inflation print came out to day, and the numbers were higher than projected.

CPI - 3.7%, expected 3.6%
Core CPI - 2.6%, expected 2.5%

I believe that will give a stronger debate for another rate hike during the next FOMC meeting on October 28.

   👀

[Iranus]

The inflation print came out to day, and the numbers were higher than projected.

CPI - 3.7%, expected 3.6%
Core CPI - 2.6%, expected 2.5%

I believe that will give a stronger debate for another rate hike during the next FOMC meeting on October 28.

   👀

One thing we shouldn't forget tho, the midterms are right around the corner, and hiking rates now isn't exactly a smart political move.

According to CME FedWatch, the market's also betting the Fed won't hike this month. 75% still see a hold despite the hotter than expected CPI print.

Imo the hike probably gets pushed to December , once the election is over.

[Wind_FURY]

The inflation print came out to day, and the numbers were higher than projected.

CPI - 3.7%, expected 3.6%
Core CPI - 2.6%, expected 2.5%

I believe that will give a stronger debate for another rate hike during the next FOMC meeting on October 28.

   👀

One thing we shouldn't forget tho, the midterms are right around the corner, and hiking rates now isn't exactly a smart political move.

According to CME FedWatch, the market's also betting the Fed won't hike this month. 75% still see a hold despite the hotter than expected CPI print.

Imo the hike probably gets pushed to December , once the election is over.

It depends on who those politicians want to please. If they want to please the people, then a rate hike will be done because it would lower the prices of goods and services. But if they want to please the upperclass, then keeping the rates unchanged will be done because it would be bullish for their assets.

   ¯\_(ツ)_/¯