Long-term rates are hanging on by fingertips to a key level, the stock market has the sillies (again), and all incoming economic reports are hot. It’s going to take a negative event (geopolitical or economic) to hold rates down where they have been for most of this year. The current Fed leadership is intent on gradual increases in the overnight cost of money (fed funds) through next year. The Fed’s hikes thus far have been free money, merely liftoff from zero. The next ones will push upward on long-term rates also, and those markets are still in denial. That whole calculus is for the moment overwhelmed by the president’s pending choice of a new chair — which of the candidates, what that new chair may say upon appointment, during confirmation hearings, and then when taking the seat early next year. Right behind, although less important: nominees to fill other vacancies among the Fed’s governors. With apologies to Stephen Hawking, a brief history of Fed time follows. So…
Source: click here
Loading ...