If they try that brings us above trend, they will need to revamp QE to save this market from a recession or possible collapse. The bonds have run lately, my thesis is they will go ahead and say the market has hiked rates for them and meanwhile keep the QE pump going to subdue the bond yields from spiking any higher. If this starts to happen it could freeze the credit markets, we need to keep the cheap money flowing because we are now addicted to it, Yellen tried in 2018 and failed had to drop them back to zero.
Yellen Failed rate hike
www.cnbc.com/2019/01...-last-rate-hike.html
You can argue whether this graph really shows anything maybe its a coincidence? But the 2yr has shown its an important indicator and is controlled by the FED. A Keynesian economist should argue we hike rates during a market boom and cut during a market decline, however in our case all we do is cut with failed attempts in rate hikes. We have moved to an age of MMT and during FED testimonials make Japan the model or refer to them as being in worse debt than we are. Credit markets are fragile and as bond yields spike higher we are seeing adverse affects on the economy.
Whether you agree with me or not I think the test is what the FED announces in March and how the markets react, if they do rate hike from where we are then they created a noose as we should break trend. BUT IF they say the market has already hiked them for us then WE KNOW they likely see the same trend.
Just my thoughts I am an idiot on the internet but wanted to share this in case I am correct. Good luck in your trades!
Yellen Failed rate hike
www.cnbc.com/2019/01...-last-rate-hike.html
You can argue whether this graph really shows anything maybe its a coincidence? But the 2yr has shown its an important indicator and is controlled by the FED. A Keynesian economist should argue we hike rates during a market boom and cut during a market decline, however in our case all we do is cut with failed attempts in rate hikes. We have moved to an age of MMT and during FED testimonials make Japan the model or refer to them as being in worse debt than we are. Credit markets are fragile and as bond yields spike higher we are seeing adverse affects on the economy.
Whether you agree with me or not I think the test is what the FED announces in March and how the markets react, if they do rate hike from where we are then they created a noose as we should break trend. BUT IF they say the market has already hiked them for us then WE KNOW they likely see the same trend.
Just my thoughts I am an idiot on the internet but wanted to share this in case I am correct. Good luck in your trades!