Dow Surges 400 Points

tabs · 11-28-2018, 08:55 AM

DOW surges 400 points on FED chairman Powell's Dovish comments....and what have I bin telling you about the Dictatorship of the FED? Back in July I commented about Equities cracking and becoming choppy after an interest rate hike. Recently I commented that the WS Boyz were afraid that Powell was not going to be as sensitive to their needs as the previous chairman and that was what was causing choppiness.Today proves my point and I don't want to hear anymore inane and ignorant comments from you boyz about it being all about T or politics.

Gogar · 11-28-2018, 09:01 AM

you sure told us so

fintstone · fintstone's Garage

Did anyone honestly think that rising interest rates were/are not impacting the stock market?

KFC911 · 11-28-2018, 09:35 AM

The voting members of the FED will continue the path they laid out in '15....and are 2/3rds of the way back to "normal". The market is still along for the ride...nothing has changed imo. The FED will raise the rates 4 more times.....next month, and 3 more times in'19...nothing new to see here....YMMV.

stevej37 · 11-28-2018, 09:37 AM

Us boyz..thank you Tabs

KFC911 · 11-28-2018, 09:37 AM

Quote:

Originally Posted by fintstone

Did anyone honestly think that rising interest rates were/are not impacting the stock market?

Did anyone think they wouldn't/aren't...honestly?

fintstone · fintstone's Garage

Quote:

Originally Posted by KC911

The voting members of the FED will continue the path they laid out in '15....and are 2/3rds of the way back to "normal". The market is still along for the ride...nothing has changed imo. The FED will raise the rates 4 more times.....next month, and 3 more times in'19...nothing new to see here....YMMV.

I think many/most believe that the remarks indicated that the projected '19 rate increases were less likely.

sammyg2 · 09:56 AM

Quote:

Originally Posted by tabs

DOW surges 400 points on FED chairman Powell's Dovish comments....and what have I bin telling you about the Dictatorship of the FED? Back in July I commented about Equities cracking and becoming choppy after an interest rate hike. Recently I commented that the WS Boyz were afraid that Powell was not going to be as sensitive to their needs as the previous chairman and that was what was causing choppiness.Today proves my point and I don't want to hear anymore inane and ignorant comments from you boyz about it being all about T or politics.

Agreed, to a point.
The FED plays games with the monetary supply which manipulates the markets. but why?
Is it because they truly believe they are "stabilizing" the economy or do they have ulterior motives to influence elections?
I believe a little of both.
Maybe not so much the moves and statements they make, as the TIMING of the moves and statements.

This was posted a week ago:

Quote:

Originally Posted by sammyg2

The downturn started the morning that the fed increased rates again, and then said they weren't done and intended more increases.
The market indices started falling on that statement and have continued a trend since that morning.
Not a coincidence.

And this was posted three weeks ago:

Quote:

Originally Posted by sammyg2

The FED is not the cure, the FED is the disease.

Manipulating monetary supply can affect temporary symptoms but they too often over-correct, they tweak, and artificially influence. that is wrong, that is bad.

Our market is designed to be self-regulating and self-adjusting. by manipulating we upset the market and it takes many years to counter. buy that time the socialistic economists (redundant) have already swung the pendulum too far in the opposite direction.

What we end up with is an unstable economy full of swings when it should be stable.
But stability doesn't make wall street rich, swings do.
Stability doesn't make your political opponents look bad, swings do.
And the small time investor/saver pays the price.

KFC911 · 11-28-2018, 09:55 AM

Quote:

Originally Posted by fintstone

I think many/most believe that the remarks indicated that the projected '19 rate increases were less likely.

That's their fault...nothing has changed. The FED rate will go 100 basis points higher by the end of '19...by consensus. His comments don't matter...nor do politics or the stock market results imo....it just is.

KFC911 · 11-28-2018, 09:58 AM

Hey Sammy...when exactly did the FED start this "manipulation" you speak of

?

ckelly78z · 11-28-2018, 10:07 AM

I looked at my 401K today, and was pleased greatly that my substantial investment is one of the only Fidelity funds that are still nicely in the positive returns for the year. Without this latest "surge" today which will more than likely improve my yearly return by an additional point, or two, I was still at 6.5% for the year, with the last 3 months all being negative.

TABS had nothing to do with this either....so a win/win !

sammyg2 · 11-28-2018, 10:23 AM

Quote:

Originally Posted by KC911

Hey Sammy...when exactly did the FED start this "manipulation" you speak of

?

1791, in Philadelphia. The guy responsible for starting the mess got shot in a duel.
See what I did there?

Quote:

Why the Fed Changes Rates
By Kimberly Amadeo
Updated September 26, 2018

The Federal Reserve prefers to keep the fed funds rate between 2 and 5 percent. It's the sweet spot that maintains a healthy economy. That's where the nation's gross domestic product grows between 2 percent and 3 percent annually. It has a natural unemployment rate between 4.5 percent and 5.0 percent. Price increases remain below the Fed's inflation target of a 2 percent core inflation rate. The current fed funds rate is 2.25 percent.

But there were times in history where the nation's benchmark interest rate was well above its sweet spot. That was to curb runaway inflation. Since 2008, it's been well below to stimulate economic growth. Once you see how the Fed changed the fed funds rate, you will understand how it manages inflation and recession.

Highest Fed Funds Rate
The fed funds rate reached a high of 20 points in 1979 and 1980. That was to combat double-digit inflation.

In 1973, inflation tripled, from 3.9 percent to 9.6 percent. The Fed only doubled interest rates from 5.75 to a high of 11 points. Inflation continued to remain in the double-digits through all of 1974, lasting until April 1975. The Fed kept raising the fed funds rate to a peak of 13 in July 1974, and then dramatically lowered the rate, reaching 7.5 by January 1975.

These sudden changes, known as stop-go monetary policy, confused businesses. They kept prices high to stay ahead of the Fed's interest rate spikes.

That only made inflation worse.

Fed leaders learned that managing inflation expectations was a critical factor in controlling inflation itself.

Lowest Fed Funds Rate
The all-time low was 0.25 percent. That's effectively zero. The Fed lowered it to this level on December 17, 2008, the 10th rate cut in a little over a year.
It didn't raise rates until December 2015.

Before this, the lowest fed funds rate was 1.0 percent in 2003, to combat the 2001 recession. At the time, there were fears that the economy was drifting towards deflation.

https://www.thebalance.com/fed-funds-rate-history-highs-lows-3306135

KFC911 · 11-28-2018, 10:31 AM

Sooooo....what's yer point Sammy? Wanna abolish the FED instead...for what...

Bitcoins

?

sammyg2 · 11-28-2018, 10:46 AM

Quote:

Originally Posted by KC911

Sooooo....what's yer point Sammy? Wanna abolish the FED instead...for what...

Bitcoins

?

Take away or at least limit their power to manipulate.
No more that 25bp per year increase or decrease with a minimum of say, 2% and a max of 4% would be a start.

Chocaholic · 11-28-2018, 10:53 AM

A one day rebound after a two week bloodbath and Tabs is suddenly a fortune teller.

masraum · 11-28-2018, 11:14 AM

Quote:

Originally Posted by Chocaholic

A one day rebound after a two week bloodbath and Tabs is suddenly a fortune teller.

I'm sure ready to pay (would $2k/month be enough? It'll pay for itself in a week, for sure!) to get his newsletter to tell me how to invest my money to make 25% due to his proven, long term track record of 99% accurate predictions!!!