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17 sats \ 20 replies \ @riberet19 3 Jul \ on: U.S. Job Market Stumbles as Government Becomes Sole Job Creator econ
This is one of the main data that the Fed looks at to lower interest rates, right?
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16 sats \ 0 replies \ @TomK OP 3 Jul
It's the most important, yes
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16 sats \ 18 replies \ @Bell_curve 3 Jul
Yes but we want private sector growth
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59 sats \ 17 replies \ @riberet19 3 Jul
What do you think will happen to the American economy when rates start to fall?
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58 sats \ 9 replies \ @Bell_curve 3 Jul
Depends on inflation, if inflation target 🎯 remains under 2 percent
Lower rates should mean more commercial activity
The other question is will the bond yield curve remain inverted
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59 sats \ 7 replies \ @riberet19 3 Jul
I've heard many economists say that when rates fall the market will crash, how true can this be? because they supposedly discount that something bad is happening in the economy and that is why they lower interest rates.
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33 sats \ 2 replies \ @TomK OP 3 Jul
A sharp fall of rates normally anticipates a deep recession. This will make investors reduce their holdings while insolvencies rise etc etc. The market crash is the bursting bubble that follows when the herd leaves the room, needs cash
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59 sats \ 1 reply \ @riberet19 3 Jul
This is what usually happens, that is, there has never been a fall in interest rates without a recession, or I am wrong
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49 sats \ 0 replies \ @TomK OP 3 Jul
I do not remember any other important case.
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16 sats \ 3 replies \ @Bell_curve 3 Jul
I don’t understand that reasoning either
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59 sats \ 2 replies \ @riberet19 3 Jul
But this is what has usually happened during past interest rate cuts.
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33 sats \ 1 reply \ @TomK OP 3 Jul
The cut is the sign of weakness and normally follows after they broke a market or a segment like banks
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16 sats \ 0 replies \ @Bell_curve 3 Jul
Bigger concern should be inflation
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17 sats \ 0 replies \ @TomK OP 3 Jul
Don't overrate the CBs influence on the bond market. Long term thr market is in full control and after a possible deflationary shock rates will explode higher
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33 sats \ 6 replies \ @TomK OP 3 Jul
A fast credit boom. Than a sharp rise hand high yields over multiple years to eliminate bad debt
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42 sats \ 0 replies \ @Bell_curve 3 Jul
1970s had this roller coaster 🎢 trend
Up then down up then down…
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17 sats \ 4 replies \ @riberet19 3 Jul
I understand, and what do you think will happen with equities?
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58 sats \ 3 replies \ @Bell_curve 3 Jul
Sluggish growth
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33 sats \ 2 replies \ @TomK OP 3 Jul
Stagflation
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59 sats \ 1 reply \ @riberet19 3 Jul
It is clear to me, nothing good...
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33 sats \ 0 replies \ @TomK OP 3 Jul
Nope
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