Powell cuts rates

6,745 Views | 60 Replies | Last: 7 days ago by MagnumLoad
Logos Stick
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1:37p, 12/18/24
Inflation rate not nearly low enough to justify this

Quote:
Fed Announces Another 25 Basis Point Interest Rate Cut
But Signals 2025 Rate Cuts Likely Sparse

https://www.forbes.com/sites/dereksaul/2024/12/18/fed-announces-another-25-basis-point-interest-rate-cut-but-signals-2025-rate-cuts-likely-sparse/




I agree with this:

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Phatbob
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1:40p, 12/18/24
AG
Keynesian economics is reaching its inevitable conclusion.
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Signel
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1:57p, 12/18/24
AG
They are cutting rates because no one is spending and they want to avoid stagflation. Sadly, rate cuts mean more inflation, so your steaks are going to go up more per pound. Meanwhile Biden is tossing out trillions to anything and anyone that will take it.

They know that if they devalue the dollar by 90%, the debt becomes less important......
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Yukon Cornelius
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2:03p, 12/18/24
AG
We should return to the US dollar. Problem solved.
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Owlagdad
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2:09p, 12/18/24
Huge gamble by Powell. If we tank worse, Fed has no credibility.
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BoydCrowder13
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2:11p, 12/18/24
He did lower the number of rate cuts next year from 4 to 2. Hence the market collapse.
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Ag87H2O
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2:22p, 12/18/24
AG
Keeping rates artificially low will only work for so long. Even with lower interest rates, eventually with out of control spending the interest on the debt will become so large there will be no other choice. We are almost there. Federal spending has to be cut. Period. Elected officials haven't had the will to do anything about it, which is the real problem. Covid bailouts shifted the baseline and put us on the fast track to a reckoning.

The only hope is that the economy does well under Trump and generates increased revenue and that DOGE will be successful enough that the public will see there is a tremendous amount of waste and fraud in the federal budget, and that cuts can be instituted without a significant loss in service. Then maybe there will be enough political support to stomach cuts where they really need to be - entitlements.
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Signel
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In reply to Ag87H2O • 2:42p, 12/18/24
AG
The other choice is to default..... Yes, the US has defaulted before, and it is likely to happen again.
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Logos Stick
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In reply to Signel • 2:47p, 12/18/24
Signel said:
The other choice is to default..... Yes, the US has defaulted before, and it is likely to happen again.


I think they inflate, ie money print, before doing that, don't you?
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Street Fighter
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In reply to Signel • 2:47p, 12/18/24
AG
Signel said:
They are cutting rates because no one is spending and they want to avoid stagflation. Sadly, rate cuts mean more inflation, so your steaks are going to go up more per pound. Meanwhile Biden is tossing out trillions to anything and anyone that will take it.

They know that if they devalue the dollar by 90%, the debt becomes less important......
They aren't avoiding that, too late. Unemployment is way higher than they are reporting, and with the price surges likely to come from this, boom.
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Detmersdislocatedshoulder
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2:55p, 12/18/24
hello stagflation my old friend
i have come to suffer with you again.
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Thunderstruck xx
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In reply to Signel • 2:58p, 12/18/24
Signel said:
The other choice is to default..... Yes, the US has defaulted before, and it is likely to happen again.


What is the impact to regular people if this happens?
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BboroAg
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In reply to Signel • 2:58p, 12/18/24
AG
We are way past devouring the dollar by 90%…
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Yukon Cornelius
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2:59p, 12/18/24
AG
We don't have to default. We just need to return to the US dollar.
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FobTies
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3:09p, 12/18/24
Powel has historically always said he doesn't speculate on any admin's policy decisions. Today, he broke that precedent and said they are considering future Trump policy. That was what was most unexpected today.
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CDUB98
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In reply to Phatbob • 3:11p, 12/18/24
AG
Phatbob said:
Keynesian economics is reaching its inevitable conclusion.
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Phatbob
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3:12p, 12/18/24
AG
For people expecting the economy to recover now just because Trump is in office... buckle up. All the government deficit spending combined with the Covid shutdowns are finally coming to a head. There is no where left to hide. There are only a few options from here:

  • Continued high inflation (make the debt worth less, but that makes everything cost more)
  • Grow the economy at a rate higher than debt growth(difficult to do with the level of debt + deficit)
  • Stop borrowing money (balance the budget)

The problem with the interest rates is that it's harder to grow the economy the higher the interest rate, but if you lower the interest rate, inflation goes higher, which also makes it harder for growing the economy for consumers (aka voters)

The only real answer long term at this point is to balance the budget and pay down the debt, but that is not going to happen with the current set of politicians and political landscape.
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Logos Stick
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In reply to Thunderstruck xx • 3:15p, 12/18/24
Thunderstruck xx said:
Signel said:
The other choice is to default..... Yes, the US has defaulted before, and it is likely to happen again.


What is the impact to regular people if this happens?


In a default?

Well, US treasuries would be darn near be worthless and rates would go through the ceiling. It would be catastrophic.
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aTmAg
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In reply to Logos Stick • 3:18p, 12/18/24
AG
Logos Stick said:
Thunderstruck xx said:
Signel said:
The other choice is to default..... Yes, the US has defaulted before, and it is likely to happen again.


What is the impact to regular people if this happens?
In a default?

Well, US treasuries would be darn near be worthless and rates would go through the ceiling. It would be catastrophic.
Still better than the consequences of doing nothing until the economy collapses on it's own.
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DallasAg 94
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In reply to Logos Stick • 3:20p, 12/18/24
Save the private sector or Govt?

Why not both.
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Yukon Cornelius
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In reply to aTmAg • 3:24p, 12/18/24
AG
Can go back to the US dollar. Leave the Fed holding the federal reserve note bag.
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DallasAg 94
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In reply to Phatbob • 3:25p, 12/18/24
Phatbob said:
Keynesian economics is reaching its inevitable conclusion.
"Modern Monetary Policy" requires 0% Interest. The idea that the Govt could spend endlessly without consequence or repayment ... Krugman touted we could spend as much as we wanted because we weren't paying the debt down.

So here we are.

Which do they want?

High Inflation where everything becomes unaffordable?
Increased Govt debt service and a loss of Social Programs and no money to buy anything?

As I mentioned on another thread... as Thatcher once said, "Eventually with Socialism... you run out of other people's money." We're there. As a result, so will everyone else. Europe is there. China is there. Brazil is there. Ukraine is there.
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Krombopulos Michael
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4:13p, 12/18/24





Nice move dumbass.......
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Detmersdislocatedshoulder
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In reply to Yukon Cornelius • 4:51p, 12/18/24
Yukon Cornelius said:
Can go back to the US dollar. Leave the Fed holding the federal reserve note bag.


i am not sure why this can't be an option. why not say F off fed your product was always illegal and we ain't paying you. the federal reserve is a private bank they are not federal/ part our govt.
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hph6203
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5:03p, 12/18/24
AG
I lost a whole week worth of gains! I'll never recover!
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Heineken-Ashi
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5:13p, 12/18/24
Bond yields tell you what the real market believes. The Fed tries to manipulate it, but unless they are outright buying or selling bonds, they are meaningless.

Like I've said for multiple years, the FED is stuck. They can't raise, as the interest on the debt would explode. And they can't lower "too much", as we would enter hyperinflation. This is their only party trick left. It's all they have. Cut ever so slightly and hint at slow cuts to come. If the bond market brushed them off and bond yields move higher, it's game over. Investors in our debt will be screaming that they refuse to take on our risk at low rates.
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FlyRod
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In reply to Detmersdislocatedshoulder • 5:53p, 12/18/24
Detmersdislocatedshoulder said:
hello stagflation my old friend
i have come to suffer with you again.



Took out Ford and Carter. Might be looking for its next victim.
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titan
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In reply to Yukon Cornelius • 6:02p, 12/18/24
S
Yukon Cornelius said:
We don't have to default. We just need to return to the US dollar.
What would that involve, implementing Ron Paul's ideas?

The dollar is enough --- you don't mean the gold standard needed?

If you had a powerful enough WH (this may be one coming) -- if wanted to, and willing to rely on blunt power, could we just force it? Its looks like Russia never really had to pay for USSR era.
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Tree Hugger
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6:35p, 12/18/24
AG
If we quit sending money to Ukraine and Iran that would help as well as ending all of this bullcrap spending on illegal immigrants. It's time to just buckle down and quit the bleeding but the Dims and their "feels" just can't comprehend that.

We need to take care of us and quit trying to pay for the rest of the world.
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YouBet
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In reply to Heineken-Ashi • 7:13p, 12/18/24
AG
Heineken-Ashi said:
Bond yields tell you what the real market believes. The Fed tries to manipulate it, but unless they are outright buying or selling bonds, they are meaningless.

Like I've said for multiple years, the FED is stuck. They can't raise, as the interest on the debt would explode. And they can't lower "too much", as we would enter hyperinflation. This is their only party trick left. It's all they have. Cut ever so slightly and hint at slow cuts to come. If the bond market brushed them off and bond yields move higher, it's game over. Investors in our debt will be screaming that they refuse to take on our risk at low rates.


Have also been saying this for years. Monetary policy is dead. There is nothing else that can be done at $36T.

Making quarter point moves is simply window dressing to make it look like they are doing something.

Will be interesting if/when the larger public realizes this.
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BadMoonRisin
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In reply to Krombopulos Michael • 7:52p, 12/18/24
AG
"Default bae"
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LuoJi
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8:12p, 12/18/24
Over time the only way the U.S. economy survives is to grow our way out of this, and not by increasing M2

5-6% growth here would light things on fire in a good way.
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Sid Farkas
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In reply to LuoJi • 8:15p, 12/18/24
AG
LuoJi said:
Over time the only way the U.S. economy survives is to grow our way out of this, and not by increasing M2

5-6% growth here would light things on fire in a good way.
and let doge decimate the federal govt.
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Ags4DaWin
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In reply to Signel • 8:38p, 12/18/24
Signel said:
The other choice is to default..... Yes, the US has defaulted before, and it is likely to happen again.


If that happens then the people who depend on social security are going to get ****ed.

The social security trust own 60% of US government debt...... which makes it the worst pontificate scheme ever.
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titan
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In reply to Ags4DaWin • 8:42p, 12/18/24
S
Ags4DaWin said:
Signel said:
The other choice is to default..... Yes, the US has defaulted before, and it is likely to happen again.


If that happens then the people who depend on social security are going to get ****ed.

The social security trust own 60% of US government debt...... which makes it the worst pontificate scheme ever.
You of course mean `ponzi' - but there is plenty of bad pontificating done from Washington as well.
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