Fed funds

[perfecho]

Will admit, however, lost a ton of money with BSE, but at least I lost it....not someone else!

[macdon02]

As much as the Fed and US/Can govts want to kickstart the economy, they cant, confidence cant be imposed, everyone has gone to cash out of fear from 08. So I believe, and as Errol has pointed out, next step is tax the cash with negative rates. Take that as you will, but if a true inflation factor is used, with these rates, the Fed/BOC is effectively robbing anyone who has gone to cash. Throw in the devaluation of the Can$ for and our net worth factored out on par to USD is slowly slipping away. Sure our grain/livestock is worth more then USD, but its all currency. If you want to keep wealth at this point in time, USD is where its at. Its all based on fear of being in any market. My glyphos saturated mind might be completely delusional but the trend says, get USD exposure at any cost because tomorrow, it will be worth more and the CD will be worth less, just like commods of any sort

[TOM4CWB]

Macdon02

Watched Bloomberg after finishing the flax swathing last night. Was 6am in the EU... and they had a good interview on the US Fed over there.

Said any country that has raised interest rates since 2008... has had to drop them the next meeting... some needing to go negative to break the downward spiral of their economy. 18 countries in deflation over in Europe... Japan had a surprising turn 1 percent positive last month... and the magic number they were joking about for China announced yesterday is... 6.53 percent growth for each year till 2020... to keep China's economy on track.

How many more interest rate cuts will China need... to keep growth at 6.53 percent... for the next 4 years? Many.

So the Bloomberg commentary was clear... Yellen is trying to put a brave face on... to make the markets THINK they are going to raise interest rates... when in fact the US Fed is going to need to reduce rates in the next adjustment. The fed did not even talk about international economic factors in yesterdays news... and said there was only one dissenter to Yellen on the news release saying they could raise rates in December.

Really... the more likely effect desired is..the US Fed... are trying to bluff people in the US into borrowing currency... to stimulate the US economy... as they are actually not far off turning negative like the 18 countries deflating in Europe.

What a tangled Web....

[errolanderson]

Good news is good news and bad news is good news for U.S. equity markets.

Bad news suggests the Fed will hike stimulus. Investors buy (much like daddy coming to the dinner table with cheque book in-hand). Stock markets remain virtually totally supported by Fed policy.

U.S. 3rd quarter GDP released this morning at 1.5%. The U.S. economy remains in zombie mode.

It's definitely a central bankers world.

[biglentil]

USD safe haven really? They got u by the short n curlies.

[cottonpicken]

Something has to give. Debt is doubling every eight years. And right now debt to GDP is over 300%. Largest peace time ratio ever in the history of the world. I dont see how any paper asset becomes more value able in the long run.

A lot of hedge fund guys i follow and other analysts are really really scared.

[biglentil]

Papers intrinsic value is 0 history has proven that all assets return to their intrinsic value.

[errolanderson]

Tres Knippa (based in Dallas) comments on Fed policy impact on bond markets / U.S. real estate.

http://www.bnn.ca/Video/player.aspx?vid=737298

[cottonpicken]

Happened to catch that guy yesterday and totally agree with him.

[TOM4CWB]

Question:

What is interest?

If there were a set single amount of currency that could not increase in 'value and quantity' how could interest ever be paid by a borrower,,, when the usery to pay the lender back... would not exist!

Productivity must be measured at COST.... a principal of economics... which means that 'Profit' is immoral???

Interest to citizens who own the currency.. is wrong... and it should and must be zero?!!!

Other wise inflation will eat up the currency... which causes central Banks... to create more currency [liquidity or in the new vernacular QE... which is now said as ... get this... EASING...]

So we fought inflation... then defeated inflation by reducing interest to zero... which is really causing DEFLATION...

But now INFLATION... is good... DEFLATION... is the enemy... and Easing is the solution...

WOW is my mind twisted now!!!

Grin!