Fed Watch: No Rate Change, But July Is in Play

Thank you, Dennis Neal. It seems like the market is loosening up here in CA.

I am always stunned at the political class that roots against our best interest so their opponents do not look successful.

You mean like stating that inflation was transitory, so they allowed the dip to happen? The problem with the FED is that they are reactionary and they do not use the tools they have to help before a swing either way. The FED is too late to the party, and the delay can cause a self-fulfilling prophecy.

Hi Matt Brady, Nearly 20 years back I worked for a boutique capital markets training consultancy. I created and delivered training such as CFA exam prep, NASD (now FINRA) exam prep-which was my primary coverage area  (though it took working it everyday to learn that I hated working with exam training), Summer Analyst and Associate training programs, equities trading simulations, Quant Finance, etc. My fellow  deskmate was previously a econometrists with the New York Federal Reserve and I knew others at the Fed as well. They are very much data driven and not reactionary as an entire group. This still holds true today. In fact, I would like to see them being slightly more reactionary- as they are too much in the data weeds so to speak.  

No, even the Fed chair Powell has stated that they would have cut rates if it wasn't for Trumps policies - which are largely and deeply inflationary measures. 

Historically, rates aren't even very high, it's more that we got addicted to incredibly low rates that weren't realistic to maintain in the long term. I would love to see mortgage rates in the mid 5's...but Trump will need to dump his Tariff policy in order for that to work, at the very least.

Hi Adam, my point is that they react too slowly. You and the FED say Trump's policies are inflationary, but that has not proven to be the case. Everyone said oil prices would go through the roof if we bombed Iran, but they dropped precipitously. If the FED would help a little, the same economic engine that provided the increased revenue in his first term could help bring our deficit down. We need to lower interest rates on our massive debt.

Matt Brady You are looking backward- which I do recommend that people consider when forming an opinion, though more important to consider what's upcoming. The 90 day pause on the Tariff's ends next week. While no one knows what will happen- an extension is strong possibility. What happens when the extensions run out. I am not everyone and oil prices are more complicated than just bombing Iran. It's clear it's not a good use of either of our time to continue to debate this- but time will tell. 

Thanks for the response, Gwen. I bet your interest rate is not 8%. I have my homes in the high 2% range and I am enjoying the earnings on savings. I want the rates to come down so others can afford their first home.