Inflation change the lowest in over two years

[TOP]

Your attempts at obfuscation don't work with me. It has nothing to do with coupons, or limits, or sales. The price of eggs dropped 14% year over year. That is a fact. All the bullshit you are throwing against the wall doesn't change that.

I'm sure you believe that...

 

[Damocles]

If the idea was to bring down inflation, then it's hard to argue that the rate (hikes) weren't effective. That said, there are so many variables that impact both supply and demand, it's impossible to know how much each of those variables has impacted prices. For example, we know that the Covid variables (pent up consumer demand, supply side issues, infusion of dollars into the money supply, etc.) were and are still at work. Egg prices shot up due to avian flu, and they are now dropping at a record pace. The Ukraine war was a huge variable.

Point is there is no way to know how much one factor that impacts demand had on prices. But the good news is that it appears we have adjusted the levers such that we have NOT gone into recession, job creation remains strong, and growth is slow but steady. That says we have, through legislation and policies, mitigated the impact of the Fed raising rates. IMHO it's impressive.

This pause in rate hikes isn't because of inflation "mitigation", as explained by the guy announcing that rates were not rising yesterday (but can in as little as one month as he said inflation indicates further increases) it is solely due to the regional bank failures (as he explained), if they hike rates further it makes it still more difficult to sell bonds they own at the lower rates so that when depositors want their money they are unable to sell bonds to deliver the funds. However they bought bonds when rates were low and were unable to sell except at a greatly discounted price (at a loss) as newer bonds at the higher rates were in demand, their low rate bonds were not. This caused them to lose money in the bargain, and not have the correct investment totals to continue in business... this caused the sale of SVB and other regional banks recently.

So, what this guy said yesterday is that while rate hikes are in order to curb the still overexcited inflation rate that has not yet reached anywhere near their goals, they are not raising right now in the hopes to shore up the survivability of some of the regional banks, to give them time...

The Fed, knowing they still have to raise interest rates to curb inflation and slow the economy, are becoming cautious, and they now walk a very thin (razor thin) line trying to balance interest rates, inflation, and the survivability of the smaller regional banks who bet on low inflation and low interest for the foreseeable future, and lost.

 

[Concart]

This pause in rate hikes isn't because of inflation "mitigation", as explained by the guy announcing that rates were not rising yesterday (but can in as little as one month as he said inflation indicates further increases) it is solely due to the regional bank failures (as he explained), if they hike rates further it makes it still more difficult to sell bonds they own at the lower rates so that when depositors want their money they are unable to sell bonds to deliver the funds. However they bought bonds when rates were low and were unable to sell except at a greatly discounted price (at a loss) as newer bonds at the higher rates were in demand, their low rate bonds were not. This caused them to lose money in the bargain, and not have the correct investment totals to continue in business... this caused the sale of SVB and other regional banks recently.

So, what this guy said yesterday is that while rate hikes are in order to curb the still overexcited inflation rate that has not yet reached anywhere near their goals, they are not raising right now in the hopes to shore up the survivability of some of the regional banks, to give them time...

The Fed, knowing they still have to raise interest rates to curb inflation and slow the economy, are becoming cautious, and they now walk a very thin (razor thin) line trying to balance interest rates, inflation, and the survivability of the smaller regional banks who bet on low inflation and low interest for the foreseeable future, and lost.

The year over year WAS over 9 percent, it is now at 4 with a goal of 2. So I'd hardly call that 'still overexcited' or 'not anywhere near their goal'. I'd say both of those are inaccurate representations of the current situation. It has been reduced by 5 percentage points, the goal is 2 more. I'm not sure what message you're trying to convey, I never suggested the rate hikes were done, I simply stated that we have mitigated the impact of the rate hikes thus far and the economy has been incredibly resilient. All we heard here, over and over and over from the right was that the market was going to tank, we would be in a recession or a depression, and unemployment would skyrocket. None of those things has happened.

P.S. - Thank you and cawacko for bringing some intelligent conversation to the table.