Bubblevision just had a discussion about whether the Fed will cut the Fed fund rate this year. One talking head said the 91 day T-bill rate is around 4.8% and has been trading under the overnight Fed funds rate for some time. That is market "proof" the currect Fed policy is STILL restrictive.
So when "could" the Fed cut the Fed funds rate & to what "neutral" level.?
First the easy part. What is a neutral level? That's the 91 day T-bill level on a yield equivalent basis. That rate is about 4.92% now. So the Fed could cut to 5%. [btw, that's where I think they should have stopped last year. That last rate bump to 5.25% was the Maria-leak induced bump for Ben's credibility.]
Second, when? That's easy, too. IIFFF the core PCE inflation rate goes below 2% for a full quarter, they could easily decide to go to a purely "neutral" Fed funds level. So that's when I think they will cut. Not until then.
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5 comments:
im thinking the lower margin requirements and bens tells people who got burned on ARMs to get 300% long some beta.
wud it shock u?
pass the kool aid
Buffet said the derivatives "make a mockery" of the margin rules, atleast for beefers. Gotta agree, from what I've read recently.
Beefers are dumping the India stocks; guess they are looking to move on for awhile.
I suppose oils are next. Oh well, I've been doing too well lately. I guess Ms. Market wants to give me some pain.
somaney says to load up on CTSH here and once the rupee stops going up it will see new hi's. chart looks bad. i put 50 shares in my IRA lol
zzzzzzzzzzzzzzzzzzz, im gonna work out
I think I'll take a nap for an hour.
Zzzzzzzzzzzzz
CTSH needs to base awhile. I have plenty - no adding unless it gets silly.
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