It's going to be real interesting to see what they do next week. I feel like we'll probably get a quarter point and then see what happens between now and May. That shouldn't have a dramatic effect on the markets one way or the other. I think people are going to need some assurances though that things are stable if they want to stay the course. They contained the systemic risk for now but it's imperative the public does not lose confidence in the FED and banking system or there's no way they can contain a larger run. I for one will pull out large sums without much thought, I did when Covid initially hit and things were very uncertain and wouldn't hesitate again. Confidence in our government & Fed is very low right now.

Not saying they won't do it, but a .25 increase would be the worst possible decision. Well, worst possible will be no increase but you get the point. They should have been going full 1% increases by now. They started late and they aren't going to catch up by going slower.

Agreed but a half point hike is totally out of the question now, we might get nothing or we might get a quarter. There's no doubt they should have started with larger increases - a .25 last March to kick things off was a joke. The markets can't handle any larger shocks now though, IMO. They also don't really know what they're doing and have been way behind this thing for nearly 2 years now.

Fed will have to pick its poison:Let banks fail uncontrollably, big rate increases, or massive inflation.

There are no free lunches. We will pay for it in some form or another.

Now would be a good time for someone to create Mattress Bank. An online bank that only takes deposits, makes no loans, offers no interest rates on savings, and doesn't invest the deposits in anything. Doesn't sound exciting but chance of default is zero and depositors money will be there when they need it.

Now would be a good time for someone to create Mattress Bank. An online bank that only takes deposits, makes no loans, offers no interest rates on savings, and doesn't invest the deposits in anything. Doesn't sound exciting but chance of default is zero and depositors money will be there when they need it.

and how does this bank make money??

and how does this bank make money??

Monthly fees for deposits. Whole operation could be run by just a few people.

I think I'll stick with an online savings account :) Getting 3.85% in Citi. I've seen some banks offering over 4% in online savings accounts.

I think I'll stick with an online savings account :) Getting 3.85% in Citi. I've seen some banks offering over 4% in online savings accounts.
I'll stick with my numbered Swiss bank account.
*checks close of markets today* Damm you Credit Suisse!!

Now would be a good time for someone to create Mattress Bank. An online bank that only takes deposits, makes no loans, offers no interest rates on savings, and doesn't invest the deposits in anything. Doesn't sound exciting but chance of default is zero and depositors money will be there when they need it.
Guessing you don’t know anything about banking. Lol.

Ironically here, SVB failed for being *too* conservative.

Ironically here, SVB failed for being *too* conservative.

Noooooot exactly. Their excess cash was put inlonger term bonds at a time interest rates were basically 0%. Rising interest rates results in lower bond prices - investment losses. Bad investment decisions regulators should have caught early-on. The bank's lack of risk control actually doing risk control contributed.

It will be interesting to see the fallout.

Noooooot exactly. Their excess cash was put inlonger term bonds at a time interest rates were basically 0%. Rising interest rates results in lower bond prices - investment losses. Bad investment decisions regulators should have caught early-on. The bank's lack of risk control actually doing risk control contributed.

It will be interesting to see the fallout.

That's pretty conservative investing. Buying bonds so that the money is "safe" is substantially more conservative than putting money in equities, mortgages, REITs, FOREX, real estate, metals, etc etc. Not conservative I guess from the liquidity perspective, but they weren't assuming they'd need to be liquid.

It just goes to show that conservative investing can be a poor choice as well.

Theoretically completely safe but their capital requirements and limitations on types of investments may have dictated "cash or cash equivalents." US treasuries are basically cash-safe but if interest rates have moved against you, you just don't get as much cash if you're fire-sale forced to sell them.

Bonds aren't necessarily safe, they got clobbered last year and same happened in 2018 although not to the same degree. I lost money both times in "safe" investments. Edward Jones requires a certain percentage in fixed income, can't be all in equities in the program I'm in. The typical 80/20 or 60/40 portfolio with bonds is a crock, IMO. I am to the point I'm about to pull everything from Edward Jones and go with a more boutique approach. Fed is creating these boom & bust cycles within the markets with one extreme to the other on monetary policy and traditional investing probably needs to be reconsidered. Quite frankly real estate has held up by far the best of the asset classes during this current bear market. If you've got spare change throw it in a rental, value is tangible and can't disappear overnight. I

Bonds aren't necessarily safe, they got clobbered last year and same happened in 2018 although not to the same degree. I lost money both times in "safe" investments. Edward Jones requires a certain percentage in fixed income, can't be all in equities in the program I'm in. The typical 80/20 or 60/40 portfolio with bonds is a crock, IMO. I am to the point I'm about to pull everything from Edward Jones and go with a more boutique approach. Fed is creating these boom & bust cycles within the markets with one extreme to the other on monetary policy and traditional investing probably needs to be reconsidered. Quite frankly real estate has held up by far the best of the asset classes during this current bear market. If you've got spare change throw it in a rental, value is tangible and can't disappear overnight. I

Don’t blame the government for bad investment advice. Bonds are entirely appropriate for many investment conditions. They aren’t good short term investment vehicles but intended for long term and income. Using them wrongly and blaming someone else is like blaming a car company because you bought a sedan and needed a pickup. Buy the right tool for the right job. People need to educate themselves on proper investment devices and strategies and quit blaming the government for their own mistakes.

Oh, and ask all those who invested in real estate how 2008 worked out for them. Assuming you can flee to real estate as a safe haven without understanding the realities is foolhardy as well.

Don’t blame the government for bad investment advice. Bonds are entirely appropriate for many investment conditions. They aren’t good short term investment vehicles but intended for long term and income. Using them wrongly and blaming someone else is like blaming a car company because you bought a sedan and needed a pickup. Buy the right tool for the right job. People need to educate themselves on proper investment devices and strategies and quit blaming the government for their own mistakes.

Oh, and ask all those who invested in real estate how 2008 worked out for them. Assuming you can flee to real estate as a safe haven without understanding the realities is foolhardy as well.

I can assure you I understand the realties much better than most. I also bought real estate in the great recession straight out of OU in 08- it was one of the smartest things one could possibly do looking back. Most people were afraid though, lets not confuse fear with opportunity. Opportunities like that don't come around often. Not unlike financing at 2-3% last couple years and buying the dip now in both the equities market & real estate. It's only going to get more expensive.

Theoretically completely safe but their capital requirements and limitations on types of investments may have dictated "cash or cash equivalents." US treasuries are basically cash-safe but if interest rates have moved against you, you just don't get as much cash if you're fire-sale forced to sell them.

That's my point. They were too conservative. Had they invested more in "riskier" asset classes beyond just Treasuries, they likely would have made some money and certainly would have had options in terms of what to liquify. The point I'm making is that conservative investing does not equate with smart investing even though we often hear that safe is the best way institutions, especially financial institutions, should handle their funds.

I can assure you I understand the realties much better than most. I also bought real estate in the great recession straight out of OU in 08- it was one of the smartest things one could possibly do looking back. Most people were afraid though, lets not confuse fear with opportunity. Opportunities like that don't come around often. Not unlike financing at 2-3% last couple years and buying the dip now in both the equities market & real estate. It's only going to get more expensive.
Yes , you benefitted on others’ losses. Good for you. But all those others that thought real estate was fool proof got fooled. Don’t mistake one lucky or good move with what generally happens. The same always increasing story can be to said about equities too. Generally the market always moves up over time. But timing and circumstances are everything.

That's my point. They were too conservative. Had they invested more in "riskier" asset classes beyond just Treasuries, they likely would have made some money and certainly would have had options in terms of what to liquify. The point I'm making is that conservative investing does not equate with smart investing even though we often hear that safe is the best way institutions, especially financial institutions, should handle their funds.

This. You're only going to get so far in life with conservative anything. You have to take risks. Calculated ones, but a good general rule is to do the opposite of what everyone else is doing. Do what others won't do and you can have what others can't have.

And now, UBS buys out Credit Suisse. Are any of the great European banking houses still in power? I miss Credit Lyonnais. Looks like Lloyds is still hanging on.

Bonds aren't necessarily safe, they got clobbered last year and same happened in 2018 although not to the same degree. I lost money both times in "safe" investments. Edward Jones requires a certain percentage in fixed income, can't be all in equities in the program I'm in. The typical 80/20 or 60/40 portfolio with bonds is a crock, IMO. I am to the point I'm about to pull everything from Edward Jones and go with a more boutique approach. Fed is creating these boom & bust cycles within the markets with one extreme to the other on monetary policy and traditional investing probably needs to be reconsidered. Quite frankly real estate has held up by far the best of the asset classes during this current bear market. If you've got spare change throw it in a rental, value is tangible and can't disappear overnight. I

I'd highly recommend switching to Vanguard, Fidelity, or Schwab. You can self-manage or get help from an advisor. I assume the fees are much more reasonable with those three compared to Edward Jones.

Markets didn't like what Powell had to say today at all, initially rose on the .25 hike. It sounds like we may get another small increase in May and then the hikes are done. Banks are going to do some of the work for them in lieu of higher rate. Honestly though they have little to no idea what direction this thing is headed and the future trajectory of things. It's no wonder we had a nasty sell off as Powell just kept rambling. I heard a lot of blah and blah. Hopefully the banking system remains healthy, it's crazy how much money has flowed out of banks and into crypto last couple weeks as people are scared.

Markets didn't like what Powell had to say today at all, initially rose on the .25 hike. It sounds like we may get another small increase in May and then the hikes are done.

hikes will only be done if inflation gets under control

hikes will only be done if inflation gets under control

Yep. Anyone betting actually money on interest rates staying level or even dropping will go the way of SVB.

The Fed would also be admitting that the banking system is weak and cant take a 'modest' rate increase.

Yep. Anyone betting actually money on interest rates staying level or even dropping will go the way of SVB.

Eventually, to get ready to be reelected, Biden will likely want to lower interest rates before very far into 2024. But the dollar will need to be strong internationally before doing that.

Eventually, to get ready to be reelected, Biden will likely want to lower interest rates before very far into 2024. But the dollar will need to be strong internationally before doing that.

He can only provide suggestions to the Federal Reserve board. Their the ones who ultimately makes this massive deficient possible so its wise to not tell them how to do their job.

Or Congress could implement some fiscal discipline because a $50 trillion national debt isn't going to help. Biden did approve a bunch of new oil drilling which I suppose is an attempt to drive down fuel prices. Of course, that in turn will cut into the electric vehicle market....and round and round we go.

Eventually, to get ready to be reelected, Biden will likely want to lower interest rates before very far into 2024. But the dollar will need to be strong internationally before doing that.

Agreed, they'll find a fix before the election next year. Most recent poll today has his overall approval rating at 38% with only 31% of people approving of his handling of the economy. Yet things could still get worse before they get better but I think things will stabilize around rate levels now with the additional lending tightening simultaneously.

Agreed, they'll find a fix before the election next year. Most recent poll today has his overall approval rating at 38% with only 31% of people approving of his handling of the economy. Yet things could still get worse before they get better but I think things will stabilize around rate levels now with the additional lending tightening simultaneously.

lol this is going to get much worse before it gets better.... inflation is still out of control

Are people honestly expecting deflation in order to correct inflation? Because that isn't how it works. As long as year over year inflation is going down, then it is working. Just may not be as fast as some would like.

lol this is going to get much worse before it gets better.... inflation is still out of control

Short the market then.

Short the market then.

have an will continue to

calls and puts are great things

have an will continue to

calls and puts are great things

Are you jumping in & out on daily action or playing it longer term? Hopefully you've made a killing if you've been shorting throughout the bear market.

Are you jumping in & out on daily action or playing it longer term? Hopefully you've made a killing if you've been shorting throughout the bear market.

i trade options quite a bit ... sell covered calls and use calls to get into a position

Not an easy game to play, especially shorting the market. I'm taking the easy route and buying index funds every week.

Back to back positive inflation reports, should be good news for rates when Fed meets again in May. From their March minutes they are already expecting the bank fallout to cause a recession later this year so I wouldn't be shocked if they pause with the hikes.

r so I wouldn't be shocked if they pause with the hikes.

i think that is very very unlikely

i think that is very very unlikely

Why? If they expect a recession this year, which would be imminent at this point, why hike? A recession in and of itself should bring down inflation even more. A shallow recession is one thing, don't need them to trigger a severe one. If we do get another .25 I think that's the last one given the current data and information.

Why? If they expect a recession this year, which would be imminent at this point, why hike? A recession in and of itself should bring down inflation even more. A shallow recession is one thing, don't need them to trigger a severe one. If we do get another .25 I think that's the last one given the current data and information.

inflation is still a major major issue ..

inflation is still a major major issue ..

0.1% inflation is a "major, major issue???"

Your comments are totally predictable based on your partisanship.

It's far more likely the Fed will cool on the interest rate increases based on the new data. Despite what some people on the left are saying, I don't believe the Fed is purposely trying to create a recession.

They are trying to moderate inflation, and it appears what they are doing is working (despite the Saudis trying to stick the knife in one last time).

0.1% inflation is a "major, major issue???"

Your comments are totally predictable based on your partisanship.

It's far more likely the Fed will cool on the interest rate increases based on the new data. Despite what some people on the left are saying, I don't believe the Fed is purposely trying to create a recession.

They are trying to moderate inflation, and it appears what they are doing is working (despite the Saudis trying to stick the knife in one last time).

I’m wondering if you have a clue what you’re talking about. Inflation “cooled” to only a 0.1% month over month rise. Sounds like you’re in the 2021 “inflation is transitory “ crew. Gas is on the rise and we are going into summer. A one month reprieve is hardly righting the ship.

0.1% inflation is a "major, major issue???"

Your comments are totally predictable based on your partisanship.

It's far more likely the Fed will cool on the interest rate increases based on the new data. Despite what some people on the left are saying, I don't believe the Fed is purposely trying to create a recession.

They are trying to moderate inflation, and it appears what they are doing is working (despite the Saudis trying to stick the knife in one last time).


what in the world are you talking about???

inflation even as the gov measures it is still over 5% .. yes that is a major major issue ..


how is inflation a partisan issue?

Inflation IS a partisan issue because government policies greatly affect inflation. In all fairness, Covid had a great influence on the economies of both President's. Trump presided over an economy that was exploding and only held back by a lack of employees. Covid hit and blew that up.

Biden, of course, inherited Covid but also an economy held together with shoestrings with only essential workers at work, an economy by delivery and an entire demographic upheaval. Where economic numbers were historically low, only an overall economic collapse would have made them worse - they could only go up and they have - but at the cost of inflation followed by higher interest rates.

Spending under Trump did skyrocket but due to Covid emergency spending. Biden continued that but also undertook multiple other massive spending programs that have resulted in our inflation, high rates and slowing economy. The only reason inflation isn't worse is because Covid and Covid spending has run out - but replaced by massive social spending that isn't economically beneficial. The infrastructure spending hasn't really started but buys 20% less, now.

Here, lets talk about how much of an issue inflation has been.

Overall since Nov. 2020, the CPI is up 14.7% - this compares with 7.1% over Trump's entire term. Over the entire year prior to the election, CPI was up just under 1%.

- This means $1.00 Nov. 2020 is now worth $0.853
- This means your $50,000/year job is now the equivalent of a $42,650 job
- lf you made $15/hr and got a $5/hr raise, it's now the same as a $17.06/hr job

Overall CPI inflation is up 5% over the past year, February's 1 year inflation was 6%, so THE RATE OF INCREASE IN PRICES IS SLOWING. Overall consumer prices are NOT dropping (that's called DEflation).

Gasoline is down significantly at 18% since last year so the rate of inflation should continue to slow overall since the price of gasoline affects everything. TVs and large appliances are down since the supply chain catastrophe is slowly unwinding.

Other than gasoline, most everything we need for survival has inflated with no guaranty of a significant overall decline. Merchants are far more hesitant to decrease prices unless competition and/or business levels force them to.

Some specific commodities-market-based items, such as eggs, have deflated significantly since Jan. 1 but most other items have not. The cost of housing and electricity hasn't dropped at all but continues to inch up and will likely continue unless there is a significant recession.

So, Econ. 101 will tell you a 1 month inflation reading means little. Longer term rates mean everything. Unfortunately, the damage is done so anything more is twisting the knife.

And gasoline is going back up now too.

And gasoline is going back up now too.

Blame Saudi Arabia and Russia for that. They have no desire to work with anyone else to lower the prices.

Blame Saudi Arabia and Russia for that. They have no desire to work with anyone else to lower the prices.

I guess you could “blame” them for wanting to keep price control on their countries most valuable asset and the product that essentially pays for the entire government. They have absolutely no sympathy for the US and how they released 350M barrels from the SPR in a year, just because they felt like it.

I guess you could “blame” them for wanting to keep price control on their countries most valuable asset and the product that essentially pays for the entire government. They have absolutely no sympathy for the US and how they released 350M barrels from the SPR in a year, just because they felt like it.
We also kinda sorta enable that and allow it to happen soooooo

We also kinda sorta enable that and allow it to happen soooooo

Yeah, I'm sure SA asked first. How did "we" allow it to happen?
Enquiring minds want to know.

Yeah, I'm sure SA asked first. How did "we" allow it to happen?
Enquiring minds want to know.

SA is smart. They know that US production is going to max out over the next few years. OPEC controls the pricing now, and they know it.


I am curious if anyone with way more knowledge in the area than me…. What are the consequences, if any, of countries like China, SA, Iran, Brazil and other countries, deciding to not use the US $ as the currency oil is traded on? It doesn’t seem like it can be any kind of positive for the strength of the US$, but it seems like there could be a multitude of ripple effects down the road.

Yeah, I'm sure SA asked first. How did "we" allow it to happen?
Enquiring minds want to know.
We could be completely energy independent if we wanted to. I mean this gets into a whole different array of subjects, including politics that Pete doesn’t want discussed on the site anymore.

As long as technology for hybrid, electric and hydrogen vehicles progresses and costs start to equate with petroleum engines, the need for oil won't be as great because supply will decline more slowly than demand.

Get EV Semi's on the road - even if just local, short haul routes, and huge amounts of petroleum will no longer be needed.

As long as technology for hybrid, electric and hydrogen vehicles progresses and costs start to equate with petroleum engines, the need for oil won't be as great because supply will decline more slowly than demand.

Get EV Semi's on the road - even if just local, short haul routes, and huge amounts of petroleum will no longer be needed.
I can’t believe we haven’t at least embarked on an initiative to install electric outlets at truck stops similar to RV parks so the trucks don’t have to idle. It seems like we should’ve done that a long time ago.