Chris Rupkey
Chris Rupkey
counsel cut dragon early fight inflation markets november rates rejected tried urged
Unfortunately, I think they tried to fight the inflation dragon a little too long, and rejected the counsel of the markets which urged them to cut rates as early as November that year.
added boost changed cut december expecting federal funds limit low rate saying stock thinking today
We're back to expecting a rate cut on December 11. Meyer changed people's thinking by essentially saying there's no limit as to how low (the federal funds rate) could go and today we're getting an added boost from the (weak) stock trade.
close commodity economy hikes june members minutes past prices rate series since sounds stale until
While it sounds as if most members see that the series of rate hikes since June 2004 is close to the end, it's not over until the economy slows. The minutes are a little past their stale date. Commodity prices are soaring.
business capital coming equipment housing purchases slack spending strong timing
Business capital spending is coming on strong and the timing of these equipment purchases could not be better. Business spending will take up the slack as the housing slowdown cools consumers' appetites.
continues economy fast fed gain growth inflation pressures slack slow stop time
Growth isn't fast enough that the Fed has to brake the economy, and at the same time it isn't slow enough that the Fed can stop and watch. Inflation pressures can still gain a foothold as the economy continues to take up slack resources.
credit due
We were due for a pullback in credit,
action fed gone looking market moves though
Expectations of Fed action have gone though the roof. The market is looking for two 25-basis-point moves and one 50-basis-point move before the presidential election.
fed officials point suggest
There is nothing at this point to suggest that Fed officials will pause.
broken budget constrain continue despite effort ink likely record records red remains side spending
The red ink was a one-month record in February, and the records are likely to continue to be broken this year. The spending side of the budget ledger remains out of control, despite some effort to constrain these expenditures.
decided path people prices resistance selling
The selling abated, prices stabilized and people decided the path of least resistance is up.
businesses energy expect factor fed increased inflation interest major makers pass policy power prices pushing rates received rising sign worried
Prices received rising so much is the first sign that businesses have increased power to pass on these energy-price increases. Energy will shortly be a major factor in the inflation equation, and this is what the Fed is worried about, so expect policy makers to keep pushing interest rates higher.
benchmark came large mac market pricing selling treasury
A lot of selling came in around 9 o'clock because Freddie Mac priced a large 10-year note, their benchmark security. Right at the pricing of that note, the Treasury market went down and it wasn't able to recover.
auction bid bigger charts demand indirect note november percent strong
There was very strong demand -- off the charts -- from the indirect bid -- about 65 percent, bigger than the 55.6 percent at the 10-year note auction in November 2005.
economic economy given growth heart jobs number result risks sector service services solid strong
This is a very solid result for the service sector given all the risks to the economic growth outlook. The services sector is the heart of the economy where most of the new jobs are created, so a strong number bodes well for the outlook.