All Eyes on the Upcoming Fed Meeting With interest rates and inflation being the main concern for investors these days, all eyes will be on the Federal Reserve's interest rate decision coming this Wednesday. Many analysts are calling for a resurgence in inflation. While the Federal Reserve has been standing by their word, saying that inflation is under control and we are on the path towards rate cuts this year. If the Fed believes that inflation is no longer...
BelleWeather
:
I think proper portfolio positioning vis a vis inflation is important. The concern I have is stagflation, so I’m trying to be defensive to that. This is difficult. And timing the market is impossible and crazy-making, so I personally am taking each day as it comes. I don’t think anyone is going to sell off over these concerns, and Powell is not about to fan those flames either!
SpyderCall
OPBelleWeather
:
They might not sell over these concerns. But when these variables are present, then any negative catalyst will likely catalyze a selloff. For example, if we get bad rhetoric from Powell next week, then we might see extra volatility. That being said, in the current environment, any selloff will be a good buying opportunity until something breaks in the economy.
SpyderCall
OPBelleWeather
:
So far, wages and employment numbers have held up, so stagflation is not a concern until inflation picks back up. With the way oil and gasoline prices have been climbing, we could possibly see a stagflationary environment soon, but not yet. Things are almost perfect in the economic data currently. We are in a goldilocks zone for the Fed right now. And if things get worse, then the Fed has already mentioned cutting rates. That would be even more accomodative for equities as the "Fed Put" will be in play at that point. So, if we do see stagflation, it shouldn't last long as the Fed will accommodate markets when the inflation, wages, or employment situation changes negatively.
BelleWeather
:
Agreed on the Goldilocks zone vis a vis the Fed mandate save one issue - the reserve bank balance is almost out - won’t they have to move to correct that?
SpyderCall
OPBelleWeather
:
They have been greatly decreasing the balance sheet since march 2022. This is done through selling treasury bonds or mortgage securities. Short-term treasuries, like bills, have been the biggest culprits for the runoff of the balance sheet. This has been unwinding the massive amount of asset purchases since the 2008 financial crisis. They purchased all of these assets back then as a form of quantative easing to boost the economy. Right now, they are selling treasury notes at sky-high yields to provide liquidity to banks essentially. This is putting more liabilities onto the balance sheet, which brings the balance down. I don't think the balance sheet runoff is such a big deal at the moment. Once the economy is showing signs of trouble, then I think we will need to worry about the Fed balance sheet. If they start buying assets, essentially quantative easing, then they might think that there is weakness in the economy. You might think that with the Fed balance falling like it is, then long-term treasuries should be falling along with the balance. But that has not been the case since last November as these treasuries have been climbing. This tells me that the balance sheet is now falling because the Fed is adding liquidity through short-term bond sales, which inject liquidity into the economy, which is good for an economy and equities.
DadOnARun
:
it's nothing until it's something. until it's something this is just hype. 3 tours into the M East, chasing and securing the red sea is a monthly event. just view a map that shows allies vs enemies. it's a mess
SpyderCall
OPDadOnARun
:
Heard. Sometimes, it seems like the media just needs something to blame for the spiking energy prices or rallying military industrial stocks
$Henry Hub Natural Gas Futures(JUN5) (NGmain.US)$ Natural Gas is Starting to Look More Bullish Nat gas has had a rough go since November this year. It has lost over 20% of its value since. The unseasonably warmer than usual weather in the norther hemisphere and the slow global economic growth has held down the commodity. More recently nat gas was consolidating near its lows with a bear flag type of wedge pattern. It seemed as if the commodity was forming a...
SpyderCall
OP
:
@ThirtyOne Check it out. I know you were asking about $United States Gasoline Fund Lp (UGA.US)$ the other day. We might see a swing up soon. I'm still trying to decide wether to go long or not. I can't find any news or any type of catalyst for this pop so I am still skeptical.
SpyderCall
OPTinkerB3ll
:
That is exactly why I am skeptical. I feel like the manipulation could be at its highest ever since the Russian war/Nat gas supply issues.
Commodities and Energy are jumping after the Fed rate hike. Jerome Powell mentioned high but manageable inflation. Is the “Volker Era” coming soon? I can barely afford a full gas tank as it is already.The ban on Russian oil by the EU is surely the cause for the pop. You can blame supply chain issues all you want. Rising oil prices is the number one cause of inflation in most cases. What’s gonna happen? Where are my commodity bulls at? I...
iamiam
:
I was bearish just for relief, because in real life it's all bullish - it's a fight for certain oil and we are buying diesel like crazy, along with everyone else its creating problems that will present themselves in the future. Just today (because of the cost of diesel) we pushed up a bunch of projects and filed a bunch of breach of contracts because some people (and govt entities) are reluctant to pay the higher cost and think price will come down (a big part with govt is they are reluctant/stubborn to use different materials and want what they call for in their specifications but they all have the same specs so everyone is chasing the same manufacturers and materials *hello more govt caused inflation*) Say you do order something and now they tell you we'll give you a price when we deliver it in 6-12 months and you can expect a higher price. Anyways I'm tired and rambling, but jpow-wow actually said today the FED can't control commodity, energy and food price inflation and that's why they dont track it. Let that sink in. This is going to end ugly but first it will be glorious. The FED cant land this, inflation wont be controlled until they crush demand but then they CRUSH DEMAND sorry for the ramble finishing my post and barely keep my eyes open
SpyderCall
OPiamiam
:
No that’s good stuff. I must have been distracted when he said he the fed doesnt track commodities for inflation. Thats pretty wild. Crushing demand seems to be the only thing they can at least try to do. Volker Era Incoming
SpyderCall
OPiamiam
:
And its funny because the other day it looked like a lot of commodities and oil were going for a small leg down and then boom EU bans Russian Oil. Couldn’t have planned it better myself
$United States Gasoline Fund Lp (UGA.US)$ with summer on corner there is upside potential are we close to resistance soon.? when we do it will be good for trading range oportunity.
Mcsnacks H Tupack
Dr J
OP
:
Yea it’s uptrending. Once it passes 25.67. It goes to 26.76. Then to 26.88. Then a pull back. Then it uptrends to over 27.00.
Stocks that are expected to benefit from a Federal Reserve rate cut. Information is provided by Futu and is a non-exhaustive list of all thematic stocks for reference purposes only.
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This section presents the top 5 stocks in U.S. Crypto Concept Stocks, ranked from highest to lowest based on real-time market data. Companies involved in the creation, trade, and services of digital forms of money.Displayed third-party logos, brands, or trademark images on screens or web pages are only for identification purposes and remain the property of their respective owners.Displayed third-party logos, brands, or trademark images on screens or web pages are only for identification purposes and remain the property of their respective owners. Information is provided by Futu and is a non-exhaustive list of all thematic stocks for reference purposes only.
This section presents the top 5 stocks in U.S. Crypto Concept Stocks, ranked from highest to lowest based on real-time market data.
Following the introduction of China's groundbreaking DeepSeek technology, Wall Street giants have revised their investment outlooks for the Chinese market.
BelleWeather : I think proper portfolio positioning vis a vis inflation is important. The concern I have is stagflation, so I’m trying to be defensive to that. This is difficult. And timing the market is impossible and crazy-making, so I personally am taking each day as it comes.
I don’t think anyone is going to sell off over these concerns, and Powell is not about to fan those flames either!
SpyderCall OP BelleWeather : They might not sell over these concerns. But when these variables are present, then any negative catalyst will likely catalyze a selloff. For example, if we get bad rhetoric from Powell next week, then we might see extra volatility. That being said, in the current environment, any selloff will be a good buying opportunity until something breaks in the economy.
SpyderCall OP BelleWeather : So far, wages and employment numbers have held up, so stagflation is not a concern until inflation picks back up. With the way oil and gasoline prices have been climbing, we could possibly see a stagflationary environment soon, but not yet. Things are almost perfect in the economic data currently. We are in a goldilocks zone for the Fed right now. And if things get worse, then the Fed has already mentioned cutting rates. That would be even more accomodative for equities as the "Fed Put" will be in play at that point. So, if we do see stagflation, it shouldn't last long as the Fed will accommodate markets when the inflation, wages, or employment situation changes negatively.
BelleWeather : Agreed on the Goldilocks zone vis a vis the Fed mandate save one issue - the reserve bank balance is almost out - won’t they have to move to correct that?
SpyderCall OP BelleWeather : They have been greatly decreasing the balance sheet since march 2022. This is done through selling treasury bonds or mortgage securities. Short-term treasuries, like bills, have been the biggest culprits for the runoff of the balance sheet. This has been unwinding the massive amount of asset purchases since the 2008 financial crisis.
They purchased all of these assets back then as a form of quantative easing to boost the economy. Right now, they are selling treasury notes at sky-high yields to provide liquidity to banks essentially. This is putting more liabilities onto the balance sheet, which brings the balance down.
I don't think the balance sheet runoff is such a big deal at the moment.
Once the economy is showing signs of trouble, then I think we will need to worry about the Fed balance sheet. If they start buying assets, essentially quantative easing, then they might think that there is weakness in the economy.
You might think that with the Fed balance falling like it is, then long-term treasuries should be falling along with the balance. But that has not been the case since last November as these treasuries have been climbing.
This tells me that the balance sheet is now falling because the Fed is adding liquidity through short-term bond sales, which inject liquidity into the economy, which is good for an economy and equities.
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