Wheels coming off as predicted

cawacko said:
I take a very different view than you do over the Fed. For example, look at the very slow economic growth following the great recession yet the stock market boomed. That was totally driven by the Fed. You remember the 2013 'temper tantrum' the market throw when Bernanke said he was going to take the punch bowl away. The Fed said they were pushing for the wealth effect by basically creating assets bubbles in equities and housing. The Fed's role in stock market started well before TGR of course but their actions affect the market more than any President does.
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First, I agree completely that the Fed has far more to say about the economy than any President. As for QE, the Fed did not and should not concern themselves with the imnpact their decisions have on the stock market. The Fed bought a bunch of long term government debt which helped restart the housing market and they bought a lot of the bad debt from banks, but recovered almost all of that. It's natural that those purchases drove down interest rates, especially long term, and caused a spike in the market, but that should NEVER be a factor in the Feds decision making.
 
Concart said:
First, I agree completely that the Fed has far more to say about the economy than any President. As for QE, the Fed did not and should not concern themselves with the imnpact their decisions have on the stock market. The Fed bought a bunch of long term government debt which helped restart the housing market and they bought a lot of the bad debt from banks, but recovered almost all of that. It's natural that those purchases drove down interest rates, especially long term, and caused a spike in the market, but that should NEVER be a factor in the Feds decision making.
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I look at it from the opposite perspective. The Fed reacts to the policies of the President. When things are rolling smoothly, they are quiet. When a blithering idiot and a cabinet that was chosen by color, gender, sex, and a myriad of other quirks as opposed to being actually qualified for the job, they are forced to make corrections to the interest rates. You are seeing the disastrous results of having this buffoon in office.
 
Lionfish said:
I look at it from the opposite perspective. The Fed reacts to the policies of the President. When things are rolling smoothly, they are quiet. When a blithering idiot and a cabinet that was chosen by color, gender, sex, and a myriad of other quirks as opposed to being actually qualified for the job, they are forced to make corrections to the interest rates. You are seeing the disastrous results of having this buffoon in office.
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Lemme guess; you never finished college. :rofl2:

Did you even take a class? Or are you just young, say under 35?
 
Concart said:
First, I agree completely that the Fed has far more to say about the economy than any President. As for QE, the Fed did not and should not concern themselves with the imnpact their decisions have on the stock market. The Fed bought a bunch of long term government debt which helped restart the housing market and they bought a lot of the bad debt from banks, but recovered almost all of that. It's natural that those purchases drove down interest rates, especially long term, and caused a spike in the market, but that should NEVER be a factor in the Feds decision making.
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I agree the Fed shouldn't make decisions based on the stock market but in reality they very much do. I think of the Greenspan Put which was almost 100% about stopping excessive stock market declines.

Bernanke's whole "wealth effect" was about boosting equity and home values to make people feel richer so that they would go spend more and in theory boost the economy. So that was very much about boosting the stock market. (It's also why much is written about the Fed being such a big driver of economic inequality but that's a separate discussion.)

It's my observation that many people just aren't well versed on monetary policy (I read about it all the time and don't consider myself knowledgeable on the subject) thus don't really understand the role its plays in driving the market and therefore they default to giving way more credit/blame to the President than the President deserves for the markets results.
 
Lionfish said:
I look at it from the opposite perspective. The Fed reacts to the policies of the President. When things are rolling smoothly, they are quiet. When a blithering idiot and a cabinet that was chosen by color, gender, sex, and a myriad of other quirks as opposed to being actually qualified for the job, they are forced to make corrections to the interest rates. You are seeing the disastrous results of having this buffoon in office.
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It doesn't work that way. When has the Fed ever been 'quiet'? (i'm not even sure what that means TBH)
 
cawacko said:
It doesn't work that way. When has the Fed ever been 'quiet'? (i'm not even sure what that means TBH)
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Thanks. This was exactly what I was talking about. Lionfish wants to turn everything into a partisan pissing contest. The Fed is the Central Bank of the United States. It sets monetary policy, and it is the lender of last resort. The Fed saved the economy in 2008 when overnight lending between banks was frozen. QE saved the housing market by lowering long term interest rates, and effectively froze all of that new money in excess reserves. What I just typed would look like a foreign language to Lionfish.
 
SmarterthanYou said:
so I can go out and advocate for civil war or secession and not worry because it's free speech?
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Correct. You just cannot take any action to plan or carry out your plans. You can advocate for anything.

They should have taught you that at the IntotheNight/SmarterthanYou/gfm7175 school of constitutional law.
 
Lionfish said:
Quiet means rapidly adjusting the interest rates which tends to affect other markets.
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This was your comment:

"When things are rolling smoothly, they are quiet."


When I think of quiet I think of something more low key. If the Fed is rapidly adjusting interest rates there's nothing quiet about that, that's going to make (big) news.
 
cawacko said:
This was your comment:

"When things are rolling smoothly, they are quiet."


When I think of quiet I think of something more low key. If the Fed is rapidly adjusting interest rates there's nothing quiet about that, that's going to make (big) news.
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Were they doing that when Trump was in office?
 
Lionfish said:
Were they doing that when Trump was in office?
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I'm still not following your line of thinking or position here (other than President's you like or don't like but that isn't the Fed). Saying things are quiet when they are rolling smoothly then defining quiet as rapidly adjusting interest rates seems contradictory.
 
cawacko said:
I'm still not following your line of thinking or position here (other than President's you like or don't like but that isn't the Fed). Saying things are quiet when they are rolling smoothly then defining quiet as rapidly adjusting interest rates seems contradictory.
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His line of thinking is typical Trumpian half-truths and alternate facts. In short, bullshitting and lying like his treasonous hero.

For those who can still remember back to the COVID crisis:

What did the Fed do in response to the COVID-19 crisis? December 17, 2021
Federal funds rate: The Fed cut its target for the federal funds rate, the rate banks pay to borrow from each other overnight, by a total of 1.5 percentage points at its meetings on March 3 and March 15, 2020. These cuts lowered the funds rate to a range of 0% to 0.25%. The federal funds rate is a benchmark for other short-term rates, and also affects longer-term rates, so this move was aimed at supporting spending by lowering the cost of borrowing for households and businesses.....
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They weren't "quiet", they did their job. We can argue about effectiveness but only dumbasses, the insane and liars will deny they did anything.
 
cawacko said:
I'm still not following your line of thinking or position here (other than President's you like or don't like but that isn't the Fed). Saying things are quiet when they are rolling smoothly then defining quiet as rapidly adjusting interest rates seems contradictory.
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What I am saying is when we have a president that encourages growth, promotes made in America, expands our largest industry to the point we are a net exporter of oil, keeps relative peace in the world, there isn't much the Fed needs to do.
When an idiot takes over and announced he is going to shut down the oil industry, it is easy to understand why the Fed will perk up its ears and the result is a number of rate changes.
 
Lionfish said:
What I am saying is when we have a president that encourages growth, promotes made in America, expands our largest industry to the point we are a net exporter of oil, keeps relative peace in the world, there isn't much the Fed needs to do.
When an idiot takes over and announced he is going to shut down the oil industry, it is easy to understand why the Fed will perk up its ears and the result is a number of rate changes.
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Just my opinion, but I think your response (whether it’s from someone on the left or right) is in line with those who don’t really understand monetary policy and think the President is the main driver of the economy and stock market. (and hence the contradictory statement about quiet and rapidly raising rates)

(And if you want to talk Trump specifically he actually made very prescient points about the Fed and their loose monetary policy and how it was causing bubbles etc. when he was a candidate in 2016. Once in office he took a totally different tack and tried to jawbone Powell into lowering rates while proclaiming the economy to be the best ever.)
 
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cawacko said:
Just my opinion, but I think your response (whether it’s from someone on the left or right) is in line with those who don’t really understand monetary policy and think the President is the main driver of the economy and stock market. (and hence the contradictory statement about quiet and rapidly raising rates)

(And if you want to talk Trump specifically he actually made very prescient points about the Fed and their loose monetary policy and how it was causing bubbles etc. when he was a candidate in 2016. Once in office he took a totally different tack and tried to jawbone Powell into lowering rates while proclaiming the economy to be the best ever.)
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I strongly believe the markets are influenced by presidential policies.
 
Lionfish said:
I strongly believe the markets are influenced by presidential policies.
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There’s a reason institutional investors who control billions upon billions of dollars hang on every word the Chairman of the Fed says when they give speeches because their words and actions move markets. A President doesn’t have that same level of influence.

Edit: the stock market was very strong under Obama. Since you think the Fed wasn’t responsible what policies of his do you believe caused that?
 
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cawacko said:
There’s a reason institutional investors who control billions upon billions of dollars hang on every word the Chairman of the Fed says when they give speeches because their words and actions move markets. A President doesn’t have that same level of influence.

Edit: the stock market was very strong under Obama. Since you think the Fed wasn’t responsible what policies of his do you believe caused that?
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Coming out of Bush policies.
 
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