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The Fed Is Facing a Dilemma


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#1 redfoliage2

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Posted 13 April 2007 - 08:26 AM

PPI up 1% after a 1.3 percent spike in February. The CPI out next week will not be friendly. The Fed is now really in a place between a rock and a hard place. Rate cut? It may be just a self-deceiving hope. I started hearing the word Stagflation.

Edited by redfoliage2, 13 April 2007 - 08:27 AM.


#2 da_cheif

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Posted 13 April 2007 - 08:29 AM

PPI up 1% after a 1.3 percent spike in February. The CPI out next week will not be friendly. The Fed is now really in a place between a rock and a hard place. Rate cut? It may be just a self-deceiving hope. I started hearing the word Stagflation.



yep ...'stagflation' ...."pushing on a string"......started hearing them words 40 years ago..... :blush:

rates are gonna go up up up....with the economic boom.....that the market is in the early stages of discounting......snort

Edited by da_cheif, 13 April 2007 - 08:30 AM.


#3 redfoliage2

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Posted 13 April 2007 - 08:31 AM

PPI up 1% after a 1.3 percent spike in February. The CPI out next week will not be friendly. The Fed is now really in a place between a rock and a hard place. Rate cut? It may be just a self-deceiving hope. I started hearing the word Stagflation.



yep ...'stagflation' ...."pushing on a string"......started hearing them words 40 years ago..... :blush:

rates are gonna go up up up....with the economic boom.....that the market is in the early stages of discounting......snort

Of course there is no lack of blind bulls on the Street. :redbull: :bear: :bear:

#4 relax

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Posted 13 April 2007 - 08:44 AM

Core PPI was unchanged

this puts Fed in a better position to lower rates


PPI up 1% after a 1.3 percent spike in February. The CPI out next week will not be friendly. The Fed is now really in a place between a rock and a hard place. Rate cut? It may be just a self-deceiving hope. I started hearing the word Stagflation.



#5 redfoliage2

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Posted 13 April 2007 - 09:10 AM

Core PPI was unchanged

this puts Fed in a better position to lower rates


PPI up 1% after a 1.3 percent spike in February. The CPI out next week will not be friendly. The Fed is now really in a place between a rock and a hard place. Rate cut? It may be just a self-deceiving hope. I started hearing the word Stagflation.

Even with unchanged inflation it's already above the Fed's comfort zone, as reflected in the Fed minutes. the CPI will tell more next week. :bear: :bear: :bear:

Edited by redfoliage2, 13 April 2007 - 09:11 AM.


#6 arbman

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Posted 13 April 2007 - 09:27 AM

Core PPI was unchanged


core readings are severely underreported...

#7 relax

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Posted 13 April 2007 - 09:36 AM

"comfort zone" is just for show

inflation of 2,5 really is not too bad, the effects of slowing growth will be much worse

therefore Fed will not raise rates - to me it is just a question of when they lower rates

will lowering rates save the economy . no cause they are lowering too late

but yes i agree, CPI next week give us some more answers

Core PPI was unchanged

this puts Fed in a better position to lower rates


PPI up 1% after a 1.3 percent spike in February. The CPI out next week will not be friendly. The Fed is now really in a place between a rock and a hard place. Rate cut? It may be just a self-deceiving hope. I started hearing the word Stagflation.

Even with unchanged inflation it's already above the Fed's comfort zone, as reflected in the Fed minutes. the CPI will tell more next week. :bear: :bear: :bear:



#8 johngeorge

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Posted 13 April 2007 - 09:46 AM

Absolutely, red. The Fed raises rates and the economy goes in the toilet. Fed lowers rates and the dollar is nailed in its coffin. Gold is the equalizer. :redbull:
Peace
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#9 ogm

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Posted 13 April 2007 - 10:34 AM

The Fed may be unable to lower rates due to the currency issues. Dollar already hitting 2 year lows against some major currencies. And that is without lowered rates, and "booming" economy. Don't forget that world central banks alone hold 2+ trillion in treasuries and other dollar reserves. nevermind other worldwide invtestors. Da chief is right, IMO, rates are going up up up, look at the 10 year yield weekly chart. Nice triangle forming there ready to break out into a major uptrend. Now the different question is, is that good for economy/market or bad ? I'm guessing falling currency and higherrates isn't partuiculary great news.

#10 denleo

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Posted 13 April 2007 - 10:59 AM

The only dilema FED faces is how much money to print. THEY DO NOT DO ANYTHING ELSE!!!!!!!!!! Never have and never will. Denleo