Category Archives: interest rates

U.S. Economic Strength: What Is The ‘Smart Money’ Telling Us?

US dollar continues to weaken

(Note: This article has been featured in the LinkedIn Channels Banking & Finance, Economy and Editor’s Picks) Smart Money – If you’ve ever bet on the ponies the ‘smart money’ will typically be the money wagered right before the betting windows closed. Theoretically these are the people who may have an inside track about the horses […]

Can U.S. Interest Rates Ever Rise?

historical U.S. inflation rate

While interest rates have risen from depths that saw the 10-year treasury yielding 1.36% on 7/3/16, to 2.25% today, given Fed plans to tighten and pledge to shrink its balance sheet should rates be even higher? The Fed will typically engage in the monetary policy of tightening and lift the Fed Funds rate when the two […]

Rising Rates Won’t Kill The Stock Market Rally, But What About Real Estate? (Chart)

Will an increase in borrowing costs bring the hammer down on homebuyers or, at these levels, is that concern much ado about nothing?

With the Janet Yellen-led Fed raising the fed funds target range while signaling more hikes may be in the immediate future, will rising rates kill the stock market rally? And, by the same token, will the rising mortgage rates that will accompany the Federal Reserve tightening policy bring the hammer down on the real estate market through […]

Post-Election: Exuberance In Stocks, Carnage In Bonds And An Unknown For Real Estate!

Ten-year Treasury Bond Yield chart

Depending on your perspective as an investor in stocks, bonds or real estate, the post-election action in the financial markets has either been phenomenally great or dismally destructive! Of course if your portfolio is well diversified as the experts suggest that it should be, then that makes for an entirely different story altogether. Bond Market […]

Federal Reserve Gradualism: A Dangerous Game?

In a move many market participants felt was long overdue, at its most recent meeting the Fed raised the fed funds rate .25%! And, after parsing the language in Janet Yellen’s statement, the belief is that 2016 may see two or three more hikes of .25% each leaving the fed funds rate in the .75%-1% range at the end of […]

Fed Decision: It’s The Final Countdown (Video)

Fed December rate decision,interest rates,Janet Yellen,FOMC

Summary: Fed rate hikes, like eating Lay’s potato chips, are rarely done just once. Will the Fed raise rates tomorrow as expected and then what will be its plan going forward? ‘Fed Decision: It’s The Final Countdown (Video)‘ Today the Fed begins to deliberate about what will likely be the first interest rate hike in nine […]

Bond Yields, The Economy And Real Estate: Are They Sustainable At Their Current Levels?

sovereign debt

Last week Fed Chair Janet Yellen decided, in the face of non-crisis level U.S. economic statistics, to leave interest rates unchanged at the economic crisis level of 0%! Her rationale was believable for some and hard to understand for others but, for anyone who listened and for those who didn’t, she mentioned non-U.S. economic factors […]

Janet Yellen Stands Pat On Rates – An Analogy

For those who may not have heard, yesterday afternoon the Fed announced that it will leave its key interest rate at 0%! This move came as a surprise to some and as no surprise to others. I count myself as being in the ‘not surprised’ camp as I expressed in an article from about one […]

Will The Fed Normalize Rates? Three Reasons Why It Won’t (Can’t)!

Will the Fed announce that it is raising rates a quarter point at the FOMC meeting that ends on September 17th, or will it stand pat? Inquiring minds want to know, particularly in some of the interest rate and economically sensitive sectors such as investments, banking, real estate and mortgages. But, as I conjectured in an […]

The Federal Reserve Needs To Raise Rates So That It Can Cut Rates!

Confused? The Fed raising interest rates in order to be able to cut them at some point in the future is the rationale I am hearing on the business news!  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 […]