CPI report leads to market surge (wholesale, credit, debt, buy)
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Is inflation finally tamed? The stock market had a great day yesterday. Short term rate hikes are off the table and the 10-year treasury rates are dropping.
Has the Fed over tightened? The bond market seems to think so.
I think a lot of the factors that rose prices are taming down, if the Russia / Ukraine war would end, that would help a lot too. It feels like the market has adjusted to real rates above 0 for a while, which is a good thing, but at least the screws have stopped tightening so to speak.
If rates remain around current levels for a while, it'll lead to different types of investments being winners from what the paradigm was before covid. In general it seems like low risk could be better off than high growth type of stuff. I think that's the art form now, what's the new basket and how to we prepare in case it wasn't really a soft landing, just a delayed hard landing in the event something buckles that was propped up for a while.
Well sure, core CPI for the past one year is 4%, but the farther out months had the highest increases.
Month-to-month CPI numbers are noisy, but looking at the past few years one can see that CPI peaked in 2021 and has been on a downward trend since then. Core CPI for each of the past 5 months has been either 0.2% or 0.3%. Overall CPI for October was actually zero.
Has the Fed overtightened? So far there's no evidence of an economic contraction, but it's only been three months since the last rate hike. Fed policy decisions are kind of like steering a tanker ship. It takes some time to see the effect, perhaps as much as a year.
It's all fake news. The Feds like to say that inflation is under control but when in fact it is out of control. Year after year inflation continues to rise while salaries have not kept up and are lagging behind. People are using credit to pay for necessities and taking on multiple jobs to make ends meet. We've had double digit inflation the past 2-3 years and now it is slowly down but haven't deflated down. So we are stuck in stagflation and soon it will cause a major meltdown. The reason why inflation is slowing because people can't afford to buy or pay for stuff using credit anymore. So naturally prices go down and this has nothing to do with the interest rates. Raising interest rates was the worst idea when there are supply issues.
It proves the Fed don't know what they're doing and continue to screw the people. The only reason Powell is not raising rates because the government can't afford to pay interest on the war debts if it continues to go up and not enough revenue from the people to pay down the interest. Tax revenue and GDP is flat because people aren't getting raises and their income being siphoned back to the Fed by high interests.
Is inflation finally tamed? The stock market had a great day yesterday. Short term rate hikes are off the table and the 10-year treasury rates are dropping.
Has the Fed over tightened? The bond market seems to think so.
One month of good news means nothing. Now if the trend continues in July could be good.
So real wages up .5% if we’re at 4% inflation? Weren’t real wages actually down, though nominally up most of last year?
Agree. Like I said, directionality matters. All about the trends.
wages for doing the same ole same ole job should be worth no more then an inflation adjustment .
most of us make more money by doing more and moving up the ladder
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