Focus on Fed Pause

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- AcidIceAcidIce
  ·2023-06-15
  A whole load of horse crap! The markets are not there to be messed with. If everything is going up only because of cheap loans, of course if interest rates goes up everything will crash down. But now it's stubbornly high meaning everything is still ok until rates goes up higher that will cause a recession, is that necessary or planned?
  Why The Fed Has Just One Core Problem After The Rate Skip
  Ahead of the Federal Open Market Committee meeting, markets swooned. When the Fed announced it would
  Why The Fed Has Just One Core Problem After The Rate Skip
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- LlimLlim
  ·2023-06-15
  What the helllll....No shit
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- runningjamesrunningjames
  ·2023-06-14
  FED should rise hike to cool the stubborn inflation further rather than wait and see... They have been seeing that for last 12 months. Pause and likely increase next month will not meet their objective.
  A Guide to the Fed's Interest Rate Decision: Pause With Option to Hike
  Federal Reserve policymakers are poised to pause their hiking of interest rates for the first time i
  A Guide to the Fed's Interest Rate Decision: Pause With Option to Hike
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- Kangaroo2021Kangaroo2021
  ·2023-06-14
  Pure NONSENSE
  Sorry, this post has been deleted
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- Andrew cubAndrew cub
  ·2023-06-14
  Go n eat pranta better
  Stocks Are Dangerously Overvalued With More Rate Hikes To Come
  Douglas Rissing The CPI report shows that inflation has remained stubbornly slow to fall, with the CORE CPI rising at 5.3%, surpassing expectations for 5.2%, creating a problem for the Fed. This will
  Stocks Are Dangerously Overvalued With More Rate Hikes To Come
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The markets are not there to be messed with. If everything is going up only because of cheap loans, of course if interest rates goes up everything will crash down. But now it's stubbornly high meaning everything is still ok until rates goes up higher that will cause a recession, is that necessary or planned?","listText":"A whole load of horse crap! The markets are not there to be messed with. If everything is going up only because of cheap loans, of course if interest rates goes up everything will crash down. But now it's stubbornly high meaning everything is still ok until rates goes up higher that will cause a recession, is that necessary or planned?","text":"A whole load of horse crap! The markets are not there to be messed with. If everything is going up only because of cheap loans, of course if interest rates goes up everything will crash down. But now it's stubbornly high meaning everything is still ok until rates goes up higher that will cause a recession, is that necessary or planned?","images":[],"top":1,"highlighted":2,"essential":1,"paper":1,"likeSize":15,"commentSize":10,"repostSize":0,"link":"https://ttm.financial/post/187465636552824","repostId":"2343999353","repostType":2,"repost":{"id":"2343999353","pubTimestamp":1686787329,"share":"https://www.laohu8.com/m/news/2343999353?lang=&edition=full","pubTime":"2023-06-15 08:02","market":"us","language":"en","title":"Why The Fed Has Just One Core Problem After The Rate Skip","url":"https://stock-news.laohu8.com/highlight/detail?id=2343999353","media":"seekingalpha","summary":"Ahead of the Federal Open Market Committee meeting, markets swooned. When the Fed announced it would","content":"<html><head></head><body><p>Ahead of the Federal Open Market Committee meeting, markets swooned. When the Fed announced it would skip raising interest rates from the June meeting, the S&amp;P 500 (SP500) closed exactly flat. Markets largely anticipated the central bank would break its consecutive strings of rate hikes. However, it did not expect plans for two more rate hikes sometime in the rest of 2023.</p><p>Core inflation is the root of the Fed&#39;s problem. The downward direction since peaking late last year is favorable. The persistently high level is the core problem.</p><h2>Fed Decision</h2><p>The Fed voted unanimously to keep the interest rate paid on reserve balances at 5.15%, effective June 15, 2023. The Fed Funds rate will stay in the target range of 5.0% to 5.25%. In the question and answer session, Fed Chair Jerome Powell said the changed the rate of interest rate increases. This is the natural course for its data-driven policy in achieving price stability at maximum employment.</p><p>The Fed now has a terminal rate of 5.6%. The core price consumption expenditure remains persistently above target. It was 4.7% for much of this year, as shown below.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/031acd3f7514d4f0836157e952731165\" tg-width=\"640\" tg-height=\"304\"/></p><p>Trading Economics</p><p>This is above the Fed&#39;s 2.0% inflation target. Until this persistently high rate falls, the central bank needs to raise rates two more times this year.</p><p>The job market may withstand this hawkish policy. Unemployment rose to 3.7%, up from the prior 3.4%. It has room to let unemployment rise to 4.5% this year.</p><h2>No Rate Cuts in 2023</h2><p>Chair Powell said that the FOMC members were unanimous in refraining from cutting rates. Ongoing hopes of a Fed Pivot, or a rate hike, in 2023 are hopeful at best. Treasury yields were mixed. The 6-month (US6M) and 12-month (US12M) yields rose after the meeting.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/52ff163fb9d3529f7dc9a2f494a02f41\" tg-width=\"405\" tg-height=\"340\"/></p><p>seekingalpha.com</p><p>The 30-year (US30Y) fell by 1.56% to adjust for expectations of another 50 bps increase this year. If markets expect rates rising no more than 50 bps in the rate hike cycle, it suggests that the 30-year ETF (TLT) will find support at around $102.00. Conservative income investors may wait for the momentum grade to improve from an &#34;F&#34; first.</p><h2>Implications of a 5.6% Terminal Rate</h2><p>Dividend income investors adjusted for the higher rate environment earlier this year. Widely held companies that paid dividends in the 3.0% yield range fell. For example, Johnson &amp; Johnson (JNJ) is down in the year-to-date period.</p><p>Solid firms that paid yields lower than 2% fell by even more. Chubb (CB) lost 14.4% YTD despite strong factor grades in growth and profitability.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/49880ec422af73bee8548cddadb6aaa9\" tg-width=\"182\" tg-height=\"116\"/></p><p>Seeking Alpha</p><p>Income investors should not buy stocks solely only high yield. Chubb is increasing shareholder returns by buying back $5 billion worth of shares. Conversely, Verizon (VZ) has a dividend that yields 7.36%. Dividends from tobacco firm Altria Group (MO) yield 8.22% after trading ex-dividend on June 14.</p><p>Those firms have near-term headwinds from a slowing economy. Verizon risks reporting lower average revenue per user if customers downgrade their service plan. Smoking and vaping customers are unlikely to cut consumption of Altria products. Unfortunately, Altria shareholders need to ride out the Anheuser-Busch InBev (BUD) controversy. Altria owns a 9% stake in the firm. The advertising controversy caused customers to boycott its product.</p><h2>Ignore Fiscal Policy</h2><p>Reporters asked Chair Powell about the government&#39;s trillions in spending policy, along with the accumulated debt. Powell said that fiscal policy is not the FOMC&#39;s mandate. Its objectives are achieving maximum employment and price stability.</p><p>Investors should look at least three months&#39; worth of economic data and their trends. The core PCE must trend lower before the Fed considers cutting rates.</p><p>June 30, 2023, is the next PCE report. It will most certainly come in at above the Fed&#39;s 2% target. Still, any drop would suggest that rates would start falling soon. At the very least, rates will fall starting in January 2024.</p><h2>Is 2% Inflation Achievable?</h2><p>Skeptics may scoff at the 2% inflation target. It will take the rest of this year and next year for that figure to fall to the 3.5% to 4.0% range. Investors should expect high interest rates are here to stay. Those who held money market funds missed out on stock gains this year. Nasdaq gained more than 33% from its lows and S&amp;P 500 is up 14.3%.</p><p>Instead of chasing the market now, investors may continue to hold above-average levels of cash. Schwab Money fund (SNAXX) yields will rise from over 5%, as will the Vanguard money funds (VUSXX). The 0-3 Month Treasury Bond ETF (SGOV) yield is 3.57%. It will rise again after two more rate hikes.</p><h2>Your Takeaway</h2><p>The Fed did not satisfy bullish investors with future rate hikes. It did not cause a &#34;sell on the news&#34; after pausing the hike this time. It struck a good balance for growth and income investors. With a clear Fed policy ahead, investors may allocate their holdings spread among cash, dividend income, and growth.</p></body></html>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Why The Fed Has Just One Core Problem After The Rate Skip</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nWhy The Fed Has Just One Core Problem After The Rate Skip\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-06-15 08:02 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4611561-why-fed-has-just-one-core-problem-after-the-rate-skip><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Ahead of the Federal Open Market Committee meeting, markets swooned. When the Fed announced it would skip raising interest rates from the June meeting, the S&P 500 (SP500) closed exactly flat. Markets...</p>\n\n<a href=\"https://seekingalpha.com/article/4611561-why-fed-has-just-one-core-problem-after-the-rate-skip\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{".IXIC":"NASDAQ Composite",".SPX":"S&P 500 Index",".DJI":"道琼斯"},"source_url":"https://seekingalpha.com/article/4611561-why-fed-has-just-one-core-problem-after-the-rate-skip","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"2343999353","content_text":"Ahead of the Federal Open Market Committee meeting, markets swooned. When the Fed announced it would skip raising interest rates from the June meeting, the S&P 500 (SP500) closed exactly flat. Markets largely anticipated the central bank would break its consecutive strings of rate hikes. However, it did not expect plans for two more rate hikes sometime in the rest of 2023.Core inflation is the root of the Fed's problem. The downward direction since peaking late last year is favorable. The persistently high level is the core problem.Fed DecisionThe Fed voted unanimously to keep the interest rate paid on reserve balances at 5.15%, effective June 15, 2023. The Fed Funds rate will stay in the target range of 5.0% to 5.25%. In the question and answer session, Fed Chair Jerome Powell said the changed the rate of interest rate increases. This is the natural course for its data-driven policy in achieving price stability at maximum employment.The Fed now has a terminal rate of 5.6%. The core price consumption expenditure remains persistently above target. It was 4.7% for much of this year, as shown below.Trading EconomicsThis is above the Fed's 2.0% inflation target. Until this persistently high rate falls, the central bank needs to raise rates two more times this year.The job market may withstand this hawkish policy. Unemployment rose to 3.7%, up from the prior 3.4%. It has room to let unemployment rise to 4.5% this year.No Rate Cuts in 2023Chair Powell said that the FOMC members were unanimous in refraining from cutting rates. Ongoing hopes of a Fed Pivot, or a rate hike, in 2023 are hopeful at best. Treasury yields were mixed. The 6-month (US6M) and 12-month (US12M) yields rose after the meeting.seekingalpha.comThe 30-year (US30Y) fell by 1.56% to adjust for expectations of another 50 bps increase this year. If markets expect rates rising no more than 50 bps in the rate hike cycle, it suggests that the 30-year ETF (TLT) will find support at around $102.00. Conservative income investors may wait for the momentum grade to improve from an \"F\" first.Implications of a 5.6% Terminal RateDividend income investors adjusted for the higher rate environment earlier this year. Widely held companies that paid dividends in the 3.0% yield range fell. For example, Johnson & Johnson (JNJ) is down in the year-to-date period.Solid firms that paid yields lower than 2% fell by even more. Chubb (CB) lost 14.4% YTD despite strong factor grades in growth and profitability.Seeking AlphaIncome investors should not buy stocks solely only high yield. Chubb is increasing shareholder returns by buying back $5 billion worth of shares. Conversely, Verizon (VZ) has a dividend that yields 7.36%. Dividends from tobacco firm Altria Group (MO) yield 8.22% after trading ex-dividend on June 14.Those firms have near-term headwinds from a slowing economy. Verizon risks reporting lower average revenue per user if customers downgrade their service plan. Smoking and vaping customers are unlikely to cut consumption of Altria products. Unfortunately, Altria shareholders need to ride out the Anheuser-Busch InBev (BUD) controversy. Altria owns a 9% stake in the firm. The advertising controversy caused customers to boycott its product.Ignore Fiscal PolicyReporters asked Chair Powell about the government's trillions in spending policy, along with the accumulated debt. Powell said that fiscal policy is not the FOMC's mandate. Its objectives are achieving maximum employment and price stability.Investors should look at least three months' worth of economic data and their trends. The core PCE must trend lower before the Fed considers cutting rates.June 30, 2023, is the next PCE report. It will most certainly come in at above the Fed's 2% target. Still, any drop would suggest that rates would start falling soon. At the very least, rates will fall starting in January 2024.Is 2% Inflation Achievable?Skeptics may scoff at the 2% inflation target. It will take the rest of this year and next year for that figure to fall to the 3.5% to 4.0% range. Investors should expect high interest rates are here to stay. Those who held money market funds missed out on stock gains this year. Nasdaq gained more than 33% from its lows and S&P 500 is up 14.3%.Instead of chasing the market now, investors may continue to hold above-average levels of cash. Schwab Money fund (SNAXX) yields will rise from over 5%, as will the Vanguard money funds (VUSXX). The 0-3 Month Treasury Bond ETF (SGOV) yield is 3.57%. It will rise again after two more rate hikes.Your TakeawayThe Fed did not satisfy bullish investors with future rate hikes. It did not cause a \"sell on the news\" after pausing the hike this time. It struck a good balance for growth and income investors. With a clear Fed policy ahead, investors may allocate their holdings spread among cash, dividend income, and growth.","news_type":1},"isVote":1,"tweetType":1,"viewCount":249,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":187447872016488,"gmtCreate":1686791450883,"gmtModify":1686793322996,"author":{"id":"4105239963331670","authorId":"4105239963331670","name":"Llim","avatar":"https://community-static.tradeup.com/news/ebdd6aa492c9d80d8a2c1a18334bff87","crmLevel":5,"crmLevelSwitch":0,"followedFlag":false},"themes":[],"htmlText":"What the helllll....No shit","listText":"What the helllll....No shit","text":"What the helllll....No shit","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":2,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/187447872016488","isVote":1,"tweetType":1,"viewCount":99,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":187219643990256,"gmtCreate":1686735546112,"gmtModify":1686736481329,"author":{"id":"4117336023184202","authorId":"4117336023184202","name":"runningjames","avatar":"https://community-static.tradeup.com/news/3467c93ce8ec8c583f28f405e68f0c00","crmLevel":2,"crmLevelSwitch":1,"followedFlag":false},"themes":[],"htmlText":"FED should rise hike to cool the stubborn inflation further rather than wait and see... They have been seeing that for last 12 months. Pause and likely increase next month will not meet their objective.&nbsp;","listText":"FED should rise hike to cool the stubborn inflation further rather than wait and see... They have been seeing that for last 12 months. Pause and likely increase next month will not meet their objective.&nbsp;","text":"FED should rise hike to cool the stubborn inflation further rather than wait and see... They have been seeing that for last 12 months. Pause and likely increase next month will not meet their objective.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":9,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/187219643990256","repostId":"1112430087","repostType":2,"repost":{"id":"1112430087","weMediaInfo":{"introduction":"Market news in one chart.","home_visible":1,"media_name":"Tiger Chart","id":"1069054253","head_image":"https://community-static.tradeup.com/news/d1ccb633d15afc1500b6785ea81e223c"},"pubTimestamp":1686729618,"share":"https://www.laohu8.com/m/news/1112430087?lang=&edition=full","pubTime":"2023-06-14 16:00","market":"us","language":"en","title":"A Guide to the Fed's Interest Rate Decision: Pause With Option to Hike","url":"https://stock-news.laohu8.com/highlight/detail?id=1112430087","media":"Tiger Chart","summary":"Federal Reserve policymakers are poised to pause their hiking of interest rates for the first time i","content":"<html><head></head><body><p>Federal Reserve policymakers are poised to pause their hiking of interest rates for the first time in 15 months, while retaining a tightening bias that signals a possible resumption of moves as soon as next month.</p><p style=\"text-align: start;\">The rate decision and committee forecasts will be released at 2 p.m. in Washington. Chair Jerome Powell will hold a press conference 30 minutes later.</p><p style=\"text-align: start;\">Powell has signaled that Fed leaders would prefer to wait to evaluate the impact of past increases on the economy as well as of recent banking failures on credit conditions. Yet with inflation still more than twice the central bank’s goal, the committee is likely to emphasize it’s keeping open its options to hike again in July or September. </p><p style=\"text-align: start;\">“This will be one of the trickier press conferences for Chair Powell, who I think will be aiming to keep market probability of a July hike reasonably high,” said Dean Maki, chief economist at Point72 and a former Fed researcher.</p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/7c7d83901db86398bce2c3f5916fc5a1\" tg-width=\"1080\" tg-height=\"1132\"/></p><h3 style=\"text-align: start;\">What Bloomberg Economics Says...</h3><blockquote>“The Fed will likely keep rates on hold at the June FOMC meeting for the first time since it began this hiking cycle in March 2022. Chairman Jerome Powell and Co. likely will characterize the decision as a “hawkish skip,” maintaining a bias toward hiking at the July meeting.”</blockquote><blockquote>— Anna Wong, Stuart Paul, Eliza Winger and Jonathan Church</blockquote><h3 style=\"text-align: start;\">June Rates</h3><p style=\"text-align: start;\">A June surprise is certainly possible. While Wall Street mostly agrees the Fed will pause, Citigroup Inc. economists and those at LH Meyer/Monetary Policy Analytics in Washington are predicting a June hike. Meyer’s firm cites Powell’s emphasis on risk management, with elevated inflation and a too-hot labor market.</p><p>The decision comes following the latest report Tuesday on the consumer price index, which showed headline inflation slowed but core prices excluding food and energy continued to rise at a pace that’s likely concerning for Fed officials.</p><p style=\"text-align: start;\">“Inflation is still too high,” said Lindsey Piegza, chief economist at Stifel Nicolaus &amp; Co.. “The Fed opened the door for a pause and to not walk through that door now would cause unnecessary concern. But they are going to have to communicate their work is not done.”</p><h3 style=\"text-align: start;\">FOMC Forecasts</h3><p style=\"text-align: start;\">Wall Street will be focused on whether the “dot plot” in the Summary of Economic Projections shows the committee seems determined to hike again. </p><p style=\"text-align: start;\">The central bank is divided between more dovish participants who are ready to stick with the committee’s March forecast of peak rates of 5.1%, and hawks who want to project a higher terminal rate of 5.4% or more. Economists surveyed by Bloomberg expect the median projection will be unchanged.</p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/103656149275b9b96321d05af6b2e45a\" tg-width=\"984\" tg-height=\"573\"/></p><p>The committee could raise its forecast for 2023 growth, look for a firmer labor market with less unemployment this year and tweak its inflation forecast higher. </p><p style=\"text-align: start;\">The upshot of the forecasts would be “hawkish compared to market pricing, because they would indicate this is just a skip, not a pause,” said Sonia Meskin, head of US macro at BNY Mellon Investment Management. </p><h3 style=\"text-align: start;\">FOMC Statement</h3><p style=\"text-align: start;\">The bulk of the statement is likely to be nearly identical to the May statement, retaining a hiking bias without a firm commitment. One option would be for the committee to note it is keeping rates unchanged “for now” or “at this meeting,” implying the possibility of a future move.</p><p style=\"text-align: start;\">The statement is likely to continue to describe growth as “modest” and job gains as “robust,” reflecting recent mixed data.</p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a25850e303c04e9feb81b84655739019\" alt=\"\" title=\"\" tg-width=\"930\" tg-height=\"523\"/></p><h3 style=\"text-align: start;\">Dissents</h3><p style=\"text-align: start;\">About 40% of economists expect a dissent at the meeting, which would be a break from the mostly unified votes by the FOMC. Minneapolis Fed President Neel Kashkari, Dallas Fed President Lorie Logan and Governor Christopher Waller, all of whom are seen as hawks pushing for higher rates, are the most likely to oppose a pause.</p><p>A hawkish dissent might reinforce the view that the committee is mulling additional hikes this summer. The last time a governor dissented on monetary policy was Mark Olson in September 2005. </p><h3 style=\"text-align: start;\">Press Conference</h3><p style=\"text-align: start;\">Powell is likely to be pressed to explain why the Fed officials are suggesting future tightening could be needed, but they aren’t moving at this meeting.</p><p style=\"text-align: start;\">“The central tension, if they pause but keep a tightening bias, is: If they’re so sure about the need for tightening in the future then why wasn’t it enough to hike now?” said Derek Tang of LH Meyer/Monetary Policy Analytics. </p><p style=\"text-align: start;\">The chair will be questioned on the outlook for July and September meetings, as well as whether he continues to see a soft landing as likely for the US economy. He’ll also be asked to assess the impact on credit from bank failures in March.</p></body></html>","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>A Guide to the Fed's Interest Rate Decision: Pause With Option to Hike</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nA Guide to the Fed's Interest Rate Decision: Pause With Option to Hike\n</h2>\n\n<h4 class=\"meta\">\n\n\n<a class=\"head\" href=\"https://laohu8.com/wemedia/1069054253\">\n\n\n<div class=\"h-thumb\" style=\"background-image:url(https://community-static.tradeup.com/news/d1ccb633d15afc1500b6785ea81e223c);background-size:cover;\"></div>\n\n<div class=\"h-content\">\n<p class=\"h-name\">Tiger Chart </p>\n<p class=\"h-time\">2023-06-14 16:00</p>\n</div>\n\n</a>\n\n\n</h4>\n\n</header>\n<article>\n<html><head></head><body><p>Federal Reserve policymakers are poised to pause their hiking of interest rates for the first time in 15 months, while retaining a tightening bias that signals a possible resumption of moves as soon as next month.</p><p style=\"text-align: start;\">The rate decision and committee forecasts will be released at 2 p.m. in Washington. Chair Jerome Powell will hold a press conference 30 minutes later.</p><p style=\"text-align: start;\">Powell has signaled that Fed leaders would prefer to wait to evaluate the impact of past increases on the economy as well as of recent banking failures on credit conditions. Yet with inflation still more than twice the central bank’s goal, the committee is likely to emphasize it’s keeping open its options to hike again in July or September. </p><p style=\"text-align: start;\">“This will be one of the trickier press conferences for Chair Powell, who I think will be aiming to keep market probability of a July hike reasonably high,” said Dean Maki, chief economist at Point72 and a former Fed researcher.</p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/7c7d83901db86398bce2c3f5916fc5a1\" tg-width=\"1080\" tg-height=\"1132\"/></p><h3 style=\"text-align: start;\">What Bloomberg Economics Says...</h3><blockquote>“The Fed will likely keep rates on hold at the June FOMC meeting for the first time since it began this hiking cycle in March 2022. Chairman Jerome Powell and Co. likely will characterize the decision as a “hawkish skip,” maintaining a bias toward hiking at the July meeting.”</blockquote><blockquote>— Anna Wong, Stuart Paul, Eliza Winger and Jonathan Church</blockquote><h3 style=\"text-align: start;\">June Rates</h3><p style=\"text-align: start;\">A June surprise is certainly possible. While Wall Street mostly agrees the Fed will pause, Citigroup Inc. economists and those at LH Meyer/Monetary Policy Analytics in Washington are predicting a June hike. Meyer’s firm cites Powell’s emphasis on risk management, with elevated inflation and a too-hot labor market.</p><p>The decision comes following the latest report Tuesday on the consumer price index, which showed headline inflation slowed but core prices excluding food and energy continued to rise at a pace that’s likely concerning for Fed officials.</p><p style=\"text-align: start;\">“Inflation is still too high,” said Lindsey Piegza, chief economist at Stifel Nicolaus &amp; Co.. “The Fed opened the door for a pause and to not walk through that door now would cause unnecessary concern. But they are going to have to communicate their work is not done.”</p><h3 style=\"text-align: start;\">FOMC Forecasts</h3><p style=\"text-align: start;\">Wall Street will be focused on whether the “dot plot” in the Summary of Economic Projections shows the committee seems determined to hike again. </p><p style=\"text-align: start;\">The central bank is divided between more dovish participants who are ready to stick with the committee’s March forecast of peak rates of 5.1%, and hawks who want to project a higher terminal rate of 5.4% or more. Economists surveyed by Bloomberg expect the median projection will be unchanged.</p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/103656149275b9b96321d05af6b2e45a\" tg-width=\"984\" tg-height=\"573\"/></p><p>The committee could raise its forecast for 2023 growth, look for a firmer labor market with less unemployment this year and tweak its inflation forecast higher. </p><p style=\"text-align: start;\">The upshot of the forecasts would be “hawkish compared to market pricing, because they would indicate this is just a skip, not a pause,” said Sonia Meskin, head of US macro at BNY Mellon Investment Management. </p><h3 style=\"text-align: start;\">FOMC Statement</h3><p style=\"text-align: start;\">The bulk of the statement is likely to be nearly identical to the May statement, retaining a hiking bias without a firm commitment. One option would be for the committee to note it is keeping rates unchanged “for now” or “at this meeting,” implying the possibility of a future move.</p><p style=\"text-align: start;\">The statement is likely to continue to describe growth as “modest” and job gains as “robust,” reflecting recent mixed data.</p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/a25850e303c04e9feb81b84655739019\" alt=\"\" title=\"\" tg-width=\"930\" tg-height=\"523\"/></p><h3 style=\"text-align: start;\">Dissents</h3><p style=\"text-align: start;\">About 40% of economists expect a dissent at the meeting, which would be a break from the mostly unified votes by the FOMC. Minneapolis Fed President Neel Kashkari, Dallas Fed President Lorie Logan and Governor Christopher Waller, all of whom are seen as hawks pushing for higher rates, are the most likely to oppose a pause.</p><p>A hawkish dissent might reinforce the view that the committee is mulling additional hikes this summer. The last time a governor dissented on monetary policy was Mark Olson in September 2005. </p><h3 style=\"text-align: start;\">Press Conference</h3><p style=\"text-align: start;\">Powell is likely to be pressed to explain why the Fed officials are suggesting future tightening could be needed, but they aren’t moving at this meeting.</p><p style=\"text-align: start;\">“The central tension, if they pause but keep a tightening bias, is: If they’re so sure about the need for tightening in the future then why wasn’t it enough to hike now?” said Derek Tang of LH Meyer/Monetary Policy Analytics. </p><p style=\"text-align: start;\">The chair will be questioned on the outlook for July and September meetings, as well as whether he continues to see a soft landing as likely for the US economy. He’ll also be asked to assess the impact on credit from bank failures in March.</p></body></html>\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{".IXIC":"NASDAQ Composite",".SPX":"S&P 500 Index",".DJI":"道琼斯"},"source_url":"","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1112430087","content_text":"Federal Reserve policymakers are poised to pause their hiking of interest rates for the first time in 15 months, while retaining a tightening bias that signals a possible resumption of moves as soon as next month.The rate decision and committee forecasts will be released at 2 p.m. in Washington. Chair Jerome Powell will hold a press conference 30 minutes later.Powell has signaled that Fed leaders would prefer to wait to evaluate the impact of past increases on the economy as well as of recent banking failures on credit conditions. Yet with inflation still more than twice the central bank’s goal, the committee is likely to emphasize it’s keeping open its options to hike again in July or September. “This will be one of the trickier press conferences for Chair Powell, who I think will be aiming to keep market probability of a July hike reasonably high,” said Dean Maki, chief economist at Point72 and a former Fed researcher.What Bloomberg Economics Says...“The Fed will likely keep rates on hold at the June FOMC meeting for the first time since it began this hiking cycle in March 2022. Chairman Jerome Powell and Co. likely will characterize the decision as a “hawkish skip,” maintaining a bias toward hiking at the July meeting.”— Anna Wong, Stuart Paul, Eliza Winger and Jonathan ChurchJune RatesA June surprise is certainly possible. While Wall Street mostly agrees the Fed will pause, Citigroup Inc. economists and those at LH Meyer/Monetary Policy Analytics in Washington are predicting a June hike. Meyer’s firm cites Powell’s emphasis on risk management, with elevated inflation and a too-hot labor market.The decision comes following the latest report Tuesday on the consumer price index, which showed headline inflation slowed but core prices excluding food and energy continued to rise at a pace that’s likely concerning for Fed officials.“Inflation is still too high,” said Lindsey Piegza, chief economist at Stifel Nicolaus & Co.. “The Fed opened the door for a pause and to not walk through that door now would cause unnecessary concern. But they are going to have to communicate their work is not done.”FOMC ForecastsWall Street will be focused on whether the “dot plot” in the Summary of Economic Projections shows the committee seems determined to hike again. The central bank is divided between more dovish participants who are ready to stick with the committee’s March forecast of peak rates of 5.1%, and hawks who want to project a higher terminal rate of 5.4% or more. Economists surveyed by Bloomberg expect the median projection will be unchanged.The committee could raise its forecast for 2023 growth, look for a firmer labor market with less unemployment this year and tweak its inflation forecast higher. The upshot of the forecasts would be “hawkish compared to market pricing, because they would indicate this is just a skip, not a pause,” said Sonia Meskin, head of US macro at BNY Mellon Investment Management. FOMC StatementThe bulk of the statement is likely to be nearly identical to the May statement, retaining a hiking bias without a firm commitment. One option would be for the committee to note it is keeping rates unchanged “for now” or “at this meeting,” implying the possibility of a future move.The statement is likely to continue to describe growth as “modest” and job gains as “robust,” reflecting recent mixed data.DissentsAbout 40% of economists expect a dissent at the meeting, which would be a break from the mostly unified votes by the FOMC. Minneapolis Fed President Neel Kashkari, Dallas Fed President Lorie Logan and Governor Christopher Waller, all of whom are seen as hawks pushing for higher rates, are the most likely to oppose a pause.A hawkish dissent might reinforce the view that the committee is mulling additional hikes this summer. The last time a governor dissented on monetary policy was Mark Olson in September 2005. Press ConferencePowell is likely to be pressed to explain why the Fed officials are suggesting future tightening could be needed, but they aren’t moving at this meeting.“The central tension, if they pause but keep a tightening bias, is: If they’re so sure about the need for tightening in the future then why wasn’t it enough to hike now?” said Derek Tang of LH Meyer/Monetary Policy Analytics. The chair will be questioned on the outlook for July and September meetings, as well as whether he continues to see a soft landing as likely for the US economy. He’ll also be asked to assess the impact on credit from bank failures in March.","news_type":1},"isVote":1,"tweetType":1,"viewCount":272,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":187131804438624,"gmtCreate":1686725751820,"gmtModify":1686725755817,"author":{"id":"3581410658404472","authorId":"3581410658404472","name":"Kangaroo2021","avatar":"https://static.tigerbbs.com/6b4af25905cb13f056c0dea7338d0381","crmLevel":2,"crmLevelSwitch":1,"followedFlag":false},"themes":[],"htmlText":"Pure NONSENSE&nbsp;","listText":"Pure NONSENSE&nbsp;","text":"Pure NONSENSE","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":12,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/187131804438624","repostId":"2343567514","repostType":4,"isVote":1,"tweetType":1,"viewCount":259,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":187127503196192,"gmtCreate":1686724700959,"gmtModify":1686724705786,"author":{"id":"4097112435042780","authorId":"4097112435042780","name":"Andrew cub","avatar":"https://static.tigerbbs.com/b5a04c94ed8355d7edc5ccec2886a154","crmLevel":7,"crmLevelSwitch":1,"followedFlag":false},"themes":[],"htmlText":"Go n eat pranta better","listText":"Go n eat pranta better","text":"Go n eat pranta better","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":10,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/187127503196192","repostId":"2343567514","repostType":4,"repost":{"id":"2343567514","pubTimestamp":1686704403,"share":"https://www.laohu8.com/m/news/2343567514?lang=&edition=full","pubTime":"2023-06-14 09:00","market":"us","language":"en","title":"Stocks Are Dangerously Overvalued With More Rate Hikes To Come","url":"https://stock-news.laohu8.com/highlight/detail?id=2343567514","media":"Seekingalpha","summary":"Douglas Rissing The CPI report shows that inflation has remained stubbornly slow to fall, with the CORE CPI rising at 5.3%, surpassing expectations for 5.2%, creating a problem for the Fed. This will ","content":"<html><head></head><body><p>The CPI report shows that inflation has remained stubbornly slow to fall, with the CORE CPI rising at 5.3%, surpassing expectations for 5.2%, creating a problem for the Fed. This will likely lead the Fed to revise its summary of economic projections to show a higher inflation outlook and more rate hikes on the dot plot.</p><p>This means that yields across the curve are likely to stay elevated and move higher in the months ahead at a time when liquidity is now being withdrawn from the overall market and equities are dangerously overvalued.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2120bacd7ae744d7a9b26b91f6d1a51d\" tg-width=\"640\" tg-height=\"286\"/></p><p>Bloomberg</p><h2>More Rate Hikes</h2><p>The market is not predicting a June rate hike, with the odds at just 10% as of this writing, and it seems unlikely that Fed will try and surprise the market, given its history. But Fed Fund futures are pricing a nearly 70% chance of a rate hike by July. With the next FOMC meeting coming at the end of July, the Fed will have more data to assess its projected rate path. However, given the hotter core CPI and searing labor market reports, it will probably mean that the dot plot will reflect another rate hike or two in 2023.</p><p>The reason is that core inflation is expected to remain sticky, and the Cleveland Fed estimates Core CPI for June at 5.1%. This means the chance the Fed is done raising rates seems slim at this point, and that will likely be reflected in the dot plots when the Summary of Economic Projections comes out.</p><p>Additionally, headline CPI on a non-seasonal adjusted basis rose by 0.3% in May. That has inflation rising at a 4.4% annualized rate of change over the past three and six months. This does suggest that it may be challenging to get inflation down now that it is entering this 3% to 4% range. It&#39;s important to remember that CPI on a year over year is measured on a non-seasonally adjusted basis, and using a seasonally adjusted CPI metric to annualize the rate of change may understate actual inflation due to changes in seasonal adjustments, which happened in 2022.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/538b5d9f6f2e8956f767d8f53d71b8c9\" tg-width=\"640\" tg-height=\"294\"/></p><p>Bloomberg</p><p>This is why bond yields aren&#39;t coming down and are rising following the CPI report. Especially when looking at the back of the curve, as markets price in a higher for longer monetary policy from the Fed, with the 30-year rate rising back to 3.92%. But more importantly, real rates are pushing higher, with the 10-Yr TIP rate now trading at 1.58% and approaching that critical level of resistance that could lead to a big break out and push to new highs.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/b14a0538cce121027cd003790fb61875\" tg-width=\"640\" tg-height=\"294\"/></p><p>Bloomberg</p><p>The 10-yr TIP is a critical rate to follow because assets such as long duration growth are priced using real rates, with the Nasdaq 100 being key. The spread between the Nasdaq 100 earnings yield and the 10-yr real yield is now at 1.93%, levels not seen since the mid-2000s, when the Nasdaq was in the middle of a valuation reset from the 2000 bubble. More importantly, the Nasdaq 100 earnings yield is 235 bps below the historical average of the last 10 years.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/763a5b0d5b2b8c255726b71f988c02aa\" tg-width=\"640\" tg-height=\"363\"/></p><p>Bloomberg</p><p>The other piece of the puzzle is that liquidity is now starting to be withdrawn from the Nasdaq 100 futures market, as measured by the depth of the book. The last time the depth of the book declined was back in August of 2022, which also marked a significant top in the market.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/810669f93ed838683f831e50269496db\" tg-width=\"640\" tg-height=\"480\"/></p><p>CME Group</p><p>The addition and withdrawal of liquidity in the Nasdaq futures market in August 2022 coincided with a move up and down reserve balances held at the Federal Reserve. Currently, reserve balances are likely to decline due to the refill of the Treasury General Account. Further, as we move into the quarter end, the reverse repo activity should begin to climb, leading to lower reserves.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/9fc60fcb97695095105c1677befc4bd5\" tg-width=\"640\" tg-height=\"294\"/></p><p>Bloomberg</p><p>The path for inflation is sticky and will continue not to be smooth, and if the current rate of changes remains, headline inflation could very well begin to accelerate in the second half of 2023 as the base effects of the first half of 2022 wane. Translating into yields staying elevated and leaving stock particularly vulnerable as the equity risk premium gets dangerously narrow and liquidity is withdrawn from the market.</p></body></html>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Stocks Are Dangerously Overvalued With More Rate Hikes To Come</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nStocks Are Dangerously Overvalued With More Rate Hikes To Come\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-06-14 09:00 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4611258-stocks-are-dangerously-overvalued-with-more-rate-hikes-to-come><strong>Seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The CPI report shows that inflation has remained stubbornly slow to fall, with the CORE CPI rising at 5.3%, surpassing expectations for 5.2%, creating a problem for the Fed. This will likely lead the ...</p>\n\n<a href=\"https://seekingalpha.com/article/4611258-stocks-are-dangerously-overvalued-with-more-rate-hikes-to-come\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{".IXIC":"NASDAQ Composite",".SPX":"S&P 500 Index",".DJI":"道琼斯"},"source_url":"https://seekingalpha.com/article/4611258-stocks-are-dangerously-overvalued-with-more-rate-hikes-to-come","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"2343567514","content_text":"The CPI report shows that inflation has remained stubbornly slow to fall, with the CORE CPI rising at 5.3%, surpassing expectations for 5.2%, creating a problem for the Fed. This will likely lead the Fed to revise its summary of economic projections to show a higher inflation outlook and more rate hikes on the dot plot.This means that yields across the curve are likely to stay elevated and move higher in the months ahead at a time when liquidity is now being withdrawn from the overall market and equities are dangerously overvalued.BloombergMore Rate HikesThe market is not predicting a June rate hike, with the odds at just 10% as of this writing, and it seems unlikely that Fed will try and surprise the market, given its history. But Fed Fund futures are pricing a nearly 70% chance of a rate hike by July. With the next FOMC meeting coming at the end of July, the Fed will have more data to assess its projected rate path. However, given the hotter core CPI and searing labor market reports, it will probably mean that the dot plot will reflect another rate hike or two in 2023.The reason is that core inflation is expected to remain sticky, and the Cleveland Fed estimates Core CPI for June at 5.1%. This means the chance the Fed is done raising rates seems slim at this point, and that will likely be reflected in the dot plots when the Summary of Economic Projections comes out.Additionally, headline CPI on a non-seasonal adjusted basis rose by 0.3% in May. That has inflation rising at a 4.4% annualized rate of change over the past three and six months. This does suggest that it may be challenging to get inflation down now that it is entering this 3% to 4% range. It's important to remember that CPI on a year over year is measured on a non-seasonally adjusted basis, and using a seasonally adjusted CPI metric to annualize the rate of change may understate actual inflation due to changes in seasonal adjustments, which happened in 2022.BloombergThis is why bond yields aren't coming down and are rising following the CPI report. Especially when looking at the back of the curve, as markets price in a higher for longer monetary policy from the Fed, with the 30-year rate rising back to 3.92%. But more importantly, real rates are pushing higher, with the 10-Yr TIP rate now trading at 1.58% and approaching that critical level of resistance that could lead to a big break out and push to new highs.BloombergThe 10-yr TIP is a critical rate to follow because assets such as long duration growth are priced using real rates, with the Nasdaq 100 being key. The spread between the Nasdaq 100 earnings yield and the 10-yr real yield is now at 1.93%, levels not seen since the mid-2000s, when the Nasdaq was in the middle of a valuation reset from the 2000 bubble. More importantly, the Nasdaq 100 earnings yield is 235 bps below the historical average of the last 10 years.BloombergThe other piece of the puzzle is that liquidity is now starting to be withdrawn from the Nasdaq 100 futures market, as measured by the depth of the book. The last time the depth of the book declined was back in August of 2022, which also marked a significant top in the market.CME GroupThe addition and withdrawal of liquidity in the Nasdaq futures market in August 2022 coincided with a move up and down reserve balances held at the Federal Reserve. Currently, reserve balances are likely to decline due to the refill of the Treasury General Account. Further, as we move into the quarter end, the reverse repo activity should begin to climb, leading to lower reserves.BloombergThe path for inflation is sticky and will continue not to be smooth, and if the current rate of changes remains, headline inflation could very well begin to accelerate in the second half of 2023 as the base effects of the first half of 2022 wane. Translating into yields staying elevated and leaving stock particularly vulnerable as the equity risk premium gets dangerously narrow and liquidity is withdrawn from the market.","news_type":1},"isVote":1,"tweetType":1,"viewCount":228,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0}],"essenList":[],"allBottom":false,"essenBottom":true}