The US Federal Reserve doesn’t see any asset price bubble and thinks that interest rates are “just below” neutral, Fed chair Jerome Powell signaled in a speech on Wednesday
In plain English, that means the Fed won’t hike interest rates much further and wants to see asset prices remain buoyant. Equity markets responded by jumping.
The dollar also fell on the news which will likely benefit emerging market equities markets, especially in Asia.
In a speech to the New York Economic Club today, Powell said: “Looking across the landscape of major asset classes, we see some classes for which valuations seem high relative to history.
But, he added, “we see no major asset class, however, where valuations appear far in excess of standard benchmarks as some did, for example, in the late 1990s dot-com boom or the pre-crisis credit boom.”
Riskier assets, he noted, “are in the upper ends of their post-crisis distributions, although they are short of the levels they hit in the pre-crisis credit boom.”
He also said, “Interest rates are still low by historical standards, and they remain just below the broad range of estimates of the level that would be neutral for the economy‑‑that is, neither speeding up nor slowing down growth.”
That’s as close to an about-face and double-time walk-back as the US central bank has ever undertaken absent a major financial crisis. It’s also a personal victory for President Trump, who blamed Fed interest rate action for recent weakness in the stock market.
The dollar’s sharp decline following Powell’s remarks is good news for emerging markets.
Higher US rates, a rising dollar and a risk-off mood in capital markets suck money out of higher-risk investments. Asian equities should be the biggest beneficiaries, although the whole spectrum of emerging markets should benefit.
Obama stated some companies were too big to fail. He should’ve let them go down, the correction would’ve been settled by now. Now we have zombie companies.
Obama stated some companies were too big to fail. He should’ve let them go down, the correction would’ve been settled by now. Now we have zombie companies.
WHAT YOU HEARD YESTERDAY WAS NOT TRUMP SPEAKING IT WAS WALL STREET SPEAKING THROUGH TRUMP. THEY KNOW ANYMORE INTEREST RATE HIKES WOULD CAUSE A FURTHER COLLAPSE OF THEIR FRAUDULENT GOW S&P NASDAQ HONEYPOTS. THIS IS A STOP GAP FOR NOW.BUT FURTHER EROSION OF THE ECONOMY THE REAL ECONOMY WILL CAUSE THE MARKETS TO RE-EVAUATE .IN OTHER WORSDS THEY CAN NOT STOP THE DECLINE OF EQUITIES.
WHAT YOU HEARD YESTERDAY WAS NOT TRUMP SPEAKING IT WAS WALL STREET SPEAKING THROUGH TRUMP. THEY KNOW ANYMORE INTEREST RATE HIKES WOULD CAUSE A FURTHER COLLAPSE OF THEIR FRAUDULENT GOW S&P NASDAQ HONEYPOTS. THIS IS A STOP GAP FOR NOW.BUT FURTHER EROSION OF THE ECONOMY THE REAL ECONOMY WILL CAUSE THE MARKETS TO RE-EVAUATE .IN OTHER WORSDS THEY CAN NOT STOP THE DECLINE OF EQUITIES.
With two party bickering 24×7, the best they can do is try to undo what their nemesis did few yr ago, and then push their spent agendas. Democratic is owned by new money, aka Silicon Valley, and the navy. Republican owned by old money, and the airforce. Also defense contractors spread their locations to buy up all the necessary senators. In short the American government is hacked by big money and special interest group and no longer serve the people despite their rhetoric and pony shows.
With two party bickering 24×7, the best they can do is try to undo what their nemesis did few yr ago, and then push their spent agendas. Democratic is owned by new money, aka Silicon Valley, and the navy. Republican owned by old money, and the airforce. Also defense contractors spread their locations to buy up all the necessary senators. In short the American government is hacked by big money and special interest group and no longer serve the people despite their rhetoric and pony shows.
Good ideas simply put, and you didn’t insult anybody. Hooray!
Good ideas simply put, and you didn’t insult anybody. Hooray!
Trump should let the Fed do its job. The decades long, easy money policies has resulted in many US companies becoming zombies and uncompetitive. Some creative destruction is required to weed out such firms and let more vigorous newcomers prosper. A 30% devaluation in the U$, 50% reduction in military spending, 100% increase in renewing infrastucture and education will do wonders for the economy in the long run.
Trump should let the Fed do its job. The decades long, easy money policies has resulted in many US companies becoming zombies and uncompetitive. Some creative destruction is required to weed out such firms and let more vigorous newcomers prosper. A 30% devaluation in the U$, 50% reduction in military spending, 100% increase in renewing infrastucture and education will do wonders for the economy in the long run.
u mistakenly assume other people want to be genetic mutants like whites or cows walking on two legs. Here is the history of Americans and Swedens after they made steroid milk mandatory for school children. https://ourworldindata.org/wp-content/uploads/2013/10/male-heights-from-skeletons-in-europe-1-2000-clark.png
u mistakenly assume other people want to be genetic mutants like whites or cows walking on two legs. Here is the history of Americans and Swedens after they made steroid milk mandatory for school children. https://ourworldindata.org/wp-content/uploads/2013/10/male-heights-from-skeletons-in-europe-1-2000-clark.png