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  • What Will Powell Say?

    From marctomarket.com

    The dollar traded better into month-end but is softer today. The Scandis and dollar-bloc currencies are leading with around 0.2%-0.5% gains. In addition to US manufacturing PMI and ISM surveys, and construction spending, auto sales will trickle in, but key for market participants today will likely be Fed Chair Powell's comments and the extent that he pushes against the dramatic rate cuts, with more than a 50% chance of the first cut by the end of Q1 24 and two cuts nearly fully discounted by mid-2024. The JP Morgan Emerging Market Currency Index is slightly firmer today to narrow this week's loss, its first in three ... (full story)

  • #1
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  • Dec 1, 2023 7:59am Dec 1, 2023 7:59am
Why does it matter what Powell says? The equities market and bond markets don't respect the FED at all!.

Look at the above statement about how the markets are "expecting a cut by the end of Q1 2024". What have all the FED speakers said, "HIGHER FOR LONGER".

I don't know how much clearer the FED can be. The equities market believes that when the economy goes into recession next year that the FED will ride to the rescue and cut rates so the party can continue. NOPE, That is NOT going to happen.
  • #2
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  • Dec 1, 2023 8:50am Dec 1, 2023 8:50am
  •  Trader#7F25
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I”m not sure they are ignoring the Fed. Speakers turned markedly dovish, that was the Fed’s choice, they bailed out the bond market because they know the government can’t afford to borrow at over 5% on the ten year. The Fed’s job, as they see it, is to bail out stocks and bonds, that’s it.
  • #3
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  • Dec 1, 2023 9:08am Dec 1, 2023 9:08am
Quoting Guest
The Fed’s job, as they see it, is to bail out stocks and bonds, that’s it.
TOTALLY 100% disagree - that is NOT their mandate

In the past the FED (Alan Greenspan) could have cared less if the stock market cratered. In fact if the stock market crashed it would definately help cut inflation. HOW?

Let's get unemployement up to 10% that will stop all the wage inflation

The stock market is hurting what the FED is trying to accomplish so I believe that the FED would like nothing better than to see it dip.
  • #4
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  • Dec 1, 2023 9:14am Dec 1, 2023 9:14am
  •  Trader#051A
  • | Status: Unregistered Trader
Quoting fx6996
{quote} TOTALLY 100% disagree - that is NOT their mandate In the past the FED (Alan Greenspan) could have cared less if the stock market cratered. In fact if the stock market crashed it would definately help cut inflation. HOW? Let's get unemployement up to 10% that will stop all the wage inflation The stock market is hurting what the FED is trying to accomplish so I believe that the FED would like nothing better than to see it dip.
The stock market is not hurting, it has recovered and doing very well. USD dollar is bearish, when that happens, it means that stock market is bullish and a buy. Same goes vice versa. Last year we were kind of in a small recession, but that is over. There is not going to be a recession, now it comes down to who is going to start cutting rates first. Inflation will eventually go back to 2% but not yet. We just have to adapt to new higher inflation for now.
  • #5
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  • Dec 1, 2023 9:19am Dec 1, 2023 9:19am
The problem isn’t wage inflation, it has lagged behind real inflation since the 80s the productivity increase has not been remotely compensated by a wage increase.
It need to catch up.

Problem is institutional inflation which essentially is designed that if you grow a potato and try to sell it, you can’t sell it unless an army of suits/institutions also get paid for the sale of the potato.
To pay them(or go to jail) you have to increase the price of that potato so you will atleast have something after the deal is done.

Anyways if any government wants to employ me, i can design some problems too. PM me.
Equality will be the next big thing in trading
  • #6
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  • Dec 1, 2023 9:31am Dec 1, 2023 9:31am
Quoting Ferna
The problem isn’t wage inflation, it has lagged behind real inflation since the 80s the productivity increase has not been remotely compensated by a wage increase. It need to catch up. Problem is institutional inflation which essentially is designed that if you grow a potato and try to sell it, you can’t sell it unless an army of suits/institutions also get paid for the sale of the potato. To pay them(or go to jail) you have to increase the price of that potato so you will atleast have something after the deal is done. Anyways if any government...
You obviously don't own a business where you actually employ people - I do.

Wages/salaries used to be 25% of my overhead - now it's 45% for the same number of staff and I can't pass that much of a price increase to my customers.

Look at the wages at GM/Ford/UPS/FedEx/Delta - all these companies HAD to pay to keep employees but in 6 months watch their stock price plummet.

HOUSING is another problem now - there is a lack of affordable housing and no one wants a 8% 30 year mortgage when 2 years ago is was 3.5%

No, the US economy needs to be broken and that only happens in 1 of 2 ways:

1. Severe Recession with unemployment 10% or more

OR

2. Civil riots and war

Pretty lousy choices if you ask me.
  • #7
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  • Dec 1, 2023 9:35am Dec 1, 2023 9:35am
  •  Trader#7F25
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Quoting Ferna
The problem isn’t wage inflation, it has lagged behind real inflation since the 80s the productivity increase has not been remotely compensated by a wage increase. It need to catch up. Problem is institutional inflation which essentially is designed that if you grow a potato and try to sell it, you can’t sell it unless an army of suits/institutions also get paid for the sale of the potato. To pay them(or go to jail) you have to increase the price of that potato so you will atleast have something after the deal is done. Anyways if any government...
We know what their written mandate is. Now look at everything they have done since 2008. Every single time, not sometimes, every time they try to be hawkish the market falls, they capitulate and give into Wall Street. Just watch, they will try to be hawkish again at some point. Market goes down a little, then the Fed will give in again and flip flop. Is inflation under 2%? No. Their wildly dovish talk over the last month proves my point.
  • #8
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  • Dec 1, 2023 9:36am Dec 1, 2023 9:36am
  •  Trader#7F25
  • | Status: Unregistered Trader
Oops, sorry meant to quote the post above that one,
  • #9
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  • Dec 1, 2023 10:14am Dec 1, 2023 10:14am
Quoting Guest
{quote} We know what their written mandate is. Now look at everything they have done since 2008. Every single time, not sometimes, every time they try to be hawkish the market falls, they capitulate and give into Wall Street. Just watch, they will try to be hawkish again at some point. Market goes down a little, then the Fed will give in again and flip flop. Is inflation under 2%? No. Their wildly dovish talk over the last month proves my point.
I understand what you wrote and to some point agree with you but overall I would say lets agree to disagree and be civil - they way it used to be.

Only time will tell. I personally believe that the FED wants the stock market to tank but that's just me.
  • #10
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  • Dec 1, 2023 10:19am Dec 1, 2023 10:19am
provocative content, from all of the above, I will only agree and disagree - the FEDS are trapped, there is no way out, he will play arround as usual , do not forget the best trader is Nancy Pelosy and the bets are all up...
another question for traders who know 10 or more years, how they will play it, including CME option bets - Jeronimo will do as he is told - we need to show super duper economy stats, we need to make money on the other end - all dogs not to be too hungry ( I mean avarage folks) - on top of it, lets not forget our DEPTH, which is gigantous, it is so much that we need new markets - the Moon, Mars and so on ....ok, now lets think a bit, the wars , Russia, China and the Briks....wait a bit, we still spend more then we do ....how will we help Ukraine?....Guys it is devastation for all of us, one needs to realise only guys like Elon can survive this madness
  • #11
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  • Dec 1, 2023 10:26am Dec 1, 2023 10:26am
The thing is the divide created has just widened even faster when accounting for 2020 covid time.

Look at the massive wealth distribution in the last 3 years from 2020-2023.

The thing is regular people are struggling their expenses have risen far faster and higher than their wages.

The whole purpose of a market is it should go UP and DOWN. It's socialistic practices when these too big to fail corporations drop the ball. It's cut throat capitalism when it comes to the public.

With the more money I've amassed in business their are way more loopholes accessible to me to try to pay the bare minimum (taxes and etc).
The solution is (x).
  • #12
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  • Dec 1, 2023 10:33am Dec 1, 2023 10:33am
  •  Trader#5C8C
  • | Status: Unregistered Trader
What does history tell us? The Fed WILL ride to the rescue like they always do! They will say they won't right up until they do and then they will cut hard and fast.
  • #13
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  • Dec 1, 2023 10:34am Dec 1, 2023 10:34am
this not socialism, socialism for the rich maybe
Equality will be the next big thing in trading
  • #14
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  • Dec 1, 2023 10:46am Dec 1, 2023 10:46am
Quoting Ferna
this not socialism, socialism for the rich maybe
You've just made my point for me.

It's capitalism for regular folks and socialism for the upper class/corporations/banks/businesses and etc.
The solution is (x).
  • #15
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  • Dec 1, 2023 11:19am Dec 1, 2023 11:19am
Quoting Momofrmnyc
{quote} You've just made my point for me. It's capitalism for regular folks and socialism for the upper class/corporations/banks/businesses and etc.
Just read a few lines in these links and see if any of it adds up to reality.

Totalitarian democracy:
A system of government in which lawfully elected representatives maintain a nation state whose citizens, while granted the right to vote, have little or no participation in the decision- making process of government.
https://en.wikipedia.org/wiki/Totalitarian_democracy

Inverted totalitarianism:
A system where economic powers like corporations exert subtle but substantial power over a system that superficially seems democratic. Over time this leads to a sense of powerlessness and political apathy.
Corps/banks etc like you said..
https://en.wikipedia.org/wiki/Inverted_totalitarianism

Neofeudalism
A re-birth of policies of governance, economy and public life of those which were present in many feudal societies.
Such aspects include: unequal rights and legal protections for common people and those considered nobility.
Dominance of societies by small and powerful elite groups of society.

Relationships of lordship and serfdom between the elite and the people, where the former are rich and the latter poor.
Lords defend people higher in the hierarchy in the feudal system, thus they are not good people to ask for change.
As that would be rebellious towards the power distribution.
https://en.wikipedia.org/wiki/Neo-feudalism

———————————————————————————
Capitalism is more linked to classical liberalism. So maybe we had it once, but does it resemble it for the ordinary people today? Or does the above short descriptions seem more likely.. know that classical liberals want as little government intervention as possible, restricting it to necessities like infrastructure, military etc.
Equality will be the next big thing in trading
  • #16
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  • Dec 1, 2023 11:21am Dec 1, 2023 11:21am
I have to agree with all of you guys, see the truth, we all agree on the same story, now we have DAX 16380 - booming German economy with guys like Mischeline closing down mega factories )))
All above comments are 100% the fact, this is one chat with no arguments, but lets wait, can be in the next months...I will close all trades soon, hope all have great Christmas and be happy with what you have - Mr Schwab and the world Forum say so.
  • #17
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  • Dec 1, 2023 11:31am Dec 1, 2023 11:31am
Quoting Ferna
{quote} Just read a few lines in these links and see if any of it adds up to reality. Totalitarian democracy: A system of government in which lawfully elected representatives maintain a nation state whose citizens, while granted the right to vote, have little or no participation in the decision- making process of government. https://en.wikipedia.org/wiki/Totalitarian_democracy Inverted totalitarianism: A system where economic powers like corporations exert subtle but substantial power over a system that superficially seems democratic....
Yes I'm loosely basing it. You're more accurate in the actual depiction of these things. I'm just venting more of frustration for what I encounter on the daily basis and the people I run into from all walks of lives complaining about the same things.
The solution is (x).
  • #18
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  • Dec 1, 2023 11:54am Dec 1, 2023 11:54am
Quoting Vancarbon
Yes , let’s be blunt It’s a fu-king disgrace and I for one am sick of the venture capitalists/hedge funds and investment banks having a free ride on the back of the working man Greedy parasitic vultures who cream the wealth from every working individual and then cry wolf when they can’t get their own way
Yup I will NOT argue with you on that point. Here's the catch - what can be done about it?

Until the entire system is brought to it's knees it will be business as usual...
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