(Note: This article also appears atĀ econintersect.com) This week both the Bank of Japan and the Federal Reserve will be meeting to chart the future course of interest rates! In the U.S. where prior to the recent small interest rate hikeĀ ZIRPĀ orĀ zero interest rate policyĀ had been in place, speculation over whether the Fed will raise or stand […]
Did Janet Yellen raise the fed funds rate in December only to turn around and lower it now? With the selloff in the equity market, sharp decline in the price of crude oil and uncertainty surrounding the U.S. and global economies, the LAST thing we need is for a crisis of confidence to develop concerning […]
In mid-DecemberĀ 2015, and for the first-time in about eight years, the Janet Yellen-led Federal Reserve raised short-term rates .25%! In a normal financial, political and economic environment one would therefore assume that the economy is in strong enough to warrant a rate hike andĀ that inflation is at or very close to the Fed’s target rate. […]
The Federal Reserve, after raising its benchmark fed funds rate .25% in December 2015, yesterday left rates unchanged! The December increase was implemented despite inflation remaining well below the Fed’s target rate of 2% and in the face of an economic recovery that could be, at best, termed tepid. At the time some speculated that […]
Come the December Fed meeting and after the strong jobs report that was recently released, does the Fed have any choice but to raise rates? The betting in the futures market leans to the side of a Fed tightening, or raising, of rates. But some of the actual economic evidence may seem to indicate that […]
The Federal Reserve has a dual mandate: Stable prices and maximum employment! Given the state of that mandate vis a vis the current condition of the U.S. economy, the answer to the question of if and when the Fed will begin to raise rates is that no one knows. But nonetheless that question has become […]
Will the Fed or won’t the Fed raise its benchmark rate 1/4 of 1% sometime this year or next? That singular question has transfixed and captivatedĀ the world’s markets, politicians and corporate decision makers since the ‘great recession’ and the subsequent Fed move to bring the target fed funds rate down to a range of 0-.25%. […]
How will the Fed’s dual mandate of stable prices and maximum employment affect the future direction of interest rates! If and when an important macroeconomic Federal Reserve indicator fails to be relevant butĀ that fact is not fully recognized by the Fed, how will decisions concerning interest rates based on that failed data input impactĀ the real […]
What is it that can and often will separate successful businessmen and investors from those who may not be? Often it’s the ability to ‘pull the trigger’ on decisions that may not be that easy to make. In the stock market the best time to buy is often the very time that everyone else is […]
Confused? The Fed raising interest rates in order to be able to cut them at some point in the future isĀ the rationale I am hearing on the business news!Ā The reason is that if (when) the United States economy heads into another recession, the Fed will have ammunition available to be able to take proactive […]
