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thedudeabides

Anyone think the Feds going to hike up Interest rates?

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 thedudeabides    2,010

So the worry in the market is that the fed is going to hike interest rates.

Wall street,doesn't. A great deal of economists however are fearful they will. If this does happen this week, we may be in for a bit of a tumble, economically. Possibly the crash we have all been expecting.

http://www.nytimes.com/2016/05/19/business/economy/federal-reserve-interest-rates-meeting-minutes.html?_r=0

Discuss.

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 Jostler    2,210

When the Federal Reserve hikes rates it will mark the end of this system.  When interest rates on bonds go up, the value of the bond itself goes down.  Everyone holding government bonds takes a mark to market loss when interest rates rise.  They are at the end of the road now.  Continue negative rates much longer and banks start dying from lack of income.  Raise them and banks die due to capital losses.

If they raise rates Wednesday...just be sure you redouble your preparation efforts.  Do it anyway, either way.  This coming crash will be epic and it is a MATHEMATICAL CERTAINTY.  The only question left is when.

In the US Treasury market alone, it has been estimated that 1 trillion dollars will be lost for every 1% rise in interest rates.  That does not include Eurobonds, Bunds, Japanese govt bonds or any other sovereign bond.  Much less all the bonds that are tied to Fed rates.

 

 

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