Question for the board econ experts
of which I am not one. You can sit this out too H.
Should rates be cut and is Powell sabotaging the recovery?
Comments
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There is some evidence of deflation out there. So if we were going off of what the Fed would normally do the answer is yes.
I would say the answer isn’t a firm yes though. Without getting federal spend under control, I think we’d see a situation kind of like during Obama’s time where there would be a huge spread between Fed rates and bond rates. So banks would just borrow and buy bonds with the juicy spreads and not lend it out to the masses. So lowering fed rates would not lower mortgage rates or auto loan rates or any other consumer debt since that is priced against bonds, usually the 10 year.
There’s a free Econ/finance lesson for Buck.
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Here’s some of deflation evidence.
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Wait - prices are going down?
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Getting gas prices and immigration under control was always the best way to fight inflation..
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I just wish that the West Coast could enjoy lower gas prices instead of higher gas taxes
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Gas taxes on the middle class used to spend money on the homeless, fund grifting environmental organizations, chicoms and US crony capitalists and fund illegal aliens is good. Tariffs used to direct investment to employ middle class Americans and to protect strategic industries is bad.
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Nailed it.
Ftr they would have done this if Biden/Kamala won though and had the media run cover just like with Obama.
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For those wondering why Obama’s real economy never got off the ground. This is how they recapitalized the banks without calling it a bailout.
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Husky fans at the natty in Houston early 2024 - "Did you see how low gas prices are here?"
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If you expected these telegraphed tariffs to produce big inflation numbers within mere weeks, you don't know much about how businesses and consumers behave.
The July-August numbers will be more telling. On the bright side, a recession might help keep prices down. Fingers crossed, ladies!
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Goalposts officially shifted.
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At some point we’ll see it right? Give us a date since you know a lot about business.
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I'm on record saying this quarter will look fine. You should try reading for comprehension, Matilda.
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Keep hope alive!
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Which sectors do you expect to see tariff driven inflation in specifically? Besides the left handed fishing reels.
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Businesses stockpiled inventory.
Consumer spending has declined.
The same "skyrocketing Biden inflation numbers" officially declared a "success" under Daddy.
The Emperor was actually naked, just in case you missed the point of that fable.
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Businesses definitely would never raise prices in anticipation of higher costs. We've never seen that before as risk mitigation. It's always after they've already incurred losses that they raise prices.
~"UW MBA" graduates
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They've been raising prices since November.
Good luck on that Mensa application.
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So they're already baked into the inflation numbers?
If I'm a midwit where does that leave you?
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Whoosh!
Inflation up slightly. Consumer spending down slightly. Pre-tariff inventories shrinking.
Everything's fine.
