Among the reasons why the Fed cut 50bps this week:
1) Inflation risk is LOWER than Employment and Consumer risk 2) The sticky component of inflation is shelter. For shelter inflation to go down we need to see more housing supply and for this we need to get lower mortgage rates = jumbo rate cut does help 3) They MUST get front-end rates lower as this colossal wall of debt matures (source: Lawrence McDonald, Bloomberg)
gold after Fed rate cuts
Source: Incremetum AG
Here she is...
Source: Barchart
The former president had in February said Federal Reserve chair Jay Powell, a registered Republican, would cut interest rates to 'help the Democrats'.
https://on.ft.com/3B5Eg0O
BlackRock just put out a nine-page white paper that makes case for bitcoin ETF as a "unique diversifier" that can hedge against fiscal, monetary and geopolitical risks
also including section called "bitcoin's path to $1 trillion market cap". Read whole thing here: https://lnkd.in/e8XVW9gG Source: Blackrock
After yesterday jumbo Fed rate cut (days after core CPI MoM reaccelerarting), who doesn't have this chart in mind???
The Second Wave of Inflation. This is what the Fed is thinking but isn't saying out loud. If you expand the dataset to the CPI's of Western economies, 87% of the time there's a second wave. Source. TS Lombard, Eric Hale
The bulls are running WILD pre-market. Thank you Mr Powell...
$DIA +1.18% $SPY +1.61% $QQQ +2.18%
FED cuts rates by 50bp to 4.75%-5% range
The Federal Reserve lowered its benchmark interest rate by a half percentage point Wednesday, in an aggressive start to a policy shift aimed at bolstering the US labor market.Committee sees another half-point of cuts in rest of 2024Policymakers penciled in an additional percentage point of cuts in 2025, according to their median forecast.