The Official "Making America Great Again" Thread

[mainejeff]

--

[mainejeff]

Can't believe that the libtards have destroyed the stock market.

They'll do anything to bring down President Trump.

[Aho Old Guy]

Got any spare change?

Check your sofa cushions, mason jars, and penny loafers. Uncle FRED needs you!



Please remain calm.
National Economic Council Director Larry Kudlow is on the job.

It must be difficult living in your own Private Idaho.



Not only is it "fucking serendipity" you guys are dumb as rocks.

Welcome to QE-4, Bubba. It's August of 2007, Part Deux. Thanks, Trumpers! Those P/Es are something else, huh?

Bring back 1980 Paul Volcker to normalize the Fed balance sheet and wring-out 50%+ of the excess liquidity. You are the poster child of the 3rd Coming of "Irrational Exuberance". Good luck with that.

You obviously have a fundamental misunderstanding of what QE means, the impact it has on the economy, and the impact it has on pricing when it's unwound. Go back to the kiddie pool, old guy. The adults are talking.

You got a graduate degree from the Larry Kudlow School of Economics, huh?

Good luck, Mr Sock Puppet.

[BDKJMU]

[Aho Old Guy]

[Aho Old Guy]

Posted 2020-02-28
Negative U.S. Interest Rates?
by Christopher J. Neely

About $11 trillion of corporate, sovereign, and securitized bonds in 24 currency markets trades at negative yields, comprising about 20 percent of the value in these markets.

The reach of negative rates is limited, however, because commercial banks find it hard to charge negative rates to their retail depositors, who might choose to hold their wealth in cash. Commercial banks have been able to charge negative rates on deposits of other financial institutions or firms to a limited degree, but negative rates still tend to compress the margin between the rates at which banks lend and that at which they borrow, which reduces their profits. The effect on banks and related financial institutions has been a major factor in restraining use of negative interest rates.

[AZGrizFan]

Got a long way to go to get to negative interest rates.

[Ibanez]

Got a long way to go to get to negative interest rates.

You know, i've read and read about negative rates and I STILL don't understand them.

[AZGrizFan]

Can't believe nobody has blamed the Nashville tornados on Trump and global warming yet.

[AZGrizFan]

Got a long way to go to get to negative interest rates.

You know, i've read and read about negative rates and I STILL don't understand them.

What are the benefits of a zero, or near-zero, Fed rate?
A Fed rate at zero doesn’t mean consumers wouldn’t have any borrowing costs – banks still need to make a profit – but it likely would mean very low monthly interest costs for home and car buyers, as well as businesses and other borrowers. The problem: Far fewer households and businesses will be eager to take out loans if the economy is in recession, says Greg McBride, chief financial analyst for Bankrate.com.
What's the downside?
Seniors and other Americans who depend heavily on income from bank savings would be frustrated by a return to microscopic savings rates below 1%. Low rates also squeeze the profit margins of banks, who make money by paying interest to depositors and lending it out at higher rates to borrowers. The prospect of slimmer margins is what prompted JPMorgan’s Dimon to say bank officials are considering introducing new fees to bolster earnings if rates dropped to zero.
That could mean raising overdraft charges and ATM fees and adding or increasing monthly maintenance fees for checking accounts, McBride says. Some banks might even hit customers with charges to transfer money or complete other transactions in person rather than online, he says.
What would it mean for the Fed to lower rates below zero?
A negative interest rate means banks would pay a small amount of money each month to park some of their money at the Fed – a reversal of how a bank typically works. Banks, in turn, could pass those interest costs to customers by charging for deposits. Currently, banks earn a small amount in interest by leaving cash at the Fed.

[Ibanez]

Can't believe nobody has blamed the Nashville tornados on Trump and global warming yet.

Adam Schiff is still at Kinko's making the presentation. Give him time.

[GannonFan]

Can't believe nobody has blamed the Nashville tornados on Trump and global warming yet.

Adam Schiff is still at Kinko's making the presentation. Give him time.

Eh, read the comments on any news item in your Facebook feed - half the comments point to climate change as the culprit.

[Aho Old Guy]

Got a long way to go to get to negative interest rates.

You know, i've read and read about negative rates and I STILL don't understand them.

It will never happen in the US (fingers crossed) -- there would be a run on the retail banks.

Over-night accounts between financial institutions, however, could be made whole by charging $00.005 or less on the dollar (negative rates) as a 'safe-haven.' That's what that $11 Trillion is ... a safe parking place for central bank funds at negative rates.

HOWEVER, it's a dog-eat-dog world out there, and you are wearing milk bone shorts. There are Hot 'Taters out there, FWMD ('Financial Weapons of Mass Destruction' - Warren Buffet coined that term) - assets so hot that financial institutions find too risky to assume in whole or at discount to close an over-night account. Woof. Woof.

Those banksters (rolling eyes). Instead of borrowing against their capital reserves at the central bank rate, the banksters are charged a 'negative fee' on those reserves. Got that? Not only do they crap all over the central bank rate, they drive down the price of that asset portfolio with a gazillion 'tranches' -- spreading the risk to other financial institutions with some fancy derivatives.

FINALLY, and I don't want to beat up on AZ, but the discount rate at 1.75% (and falling?) and the Consumer Price Index at 2.1% -- you are in the negative, my friend.

[AZGrizFan]

You know, i've read and read about negative rates and I STILL don't understand them.

It will never happen in the US (fingers crossed) -- there would be a run on the retail banks.

Over-night accounts between financial institutions, however, could be made whole by charging $00.005 or less on the dollar (negative rates) as a 'safe-haven.' That's what that $11 Trillion is ... a safe parking place for central bank funds at negative rates.

HOWEVER, it's a dog-eat-dog world out there, and you are wearing milk bone shorts. There are Hot 'Taters out there, FWMD ('Financial Weapons of Mass Destruction' - Warren Buffet coined that term) - assets so hot that financial institutions find too risky to assume in whole or at discount to close an over-night account. Woof. Woof.

Those banksters (rolling eyes). Instead of borrowing against their capital reserves at the central bank rate, the banksters are charged a 'negative fee' on those reserves. Got that? Not only do they crap all over the central bank rate, they drive down the price of that asset portfolio with a gazillion 'tranches' -- spreading the risk to other financial institutions with some fancy derivatives.

FINALLY, and I don't want to beat up on AZ, but the discount rate at 1.75% (and falling?) and the Consumer Price Index at 2.1% -- you are in the negative, my friend.

Actually, negative rates (at the retail level) DID happen, during the 2008 Great Recession. While the Fed wasn't technically negative, there were financial institutions out west that were CHARGING depositors to keep their money in the financial institution. Here's why: Loan losses were so high, FI's were seeing big negative earnings reports roll in. This was reducing their capital ratio below acceptable levels. The denominator of Capital Ratio is "Assets". The only way to shrink your balance sheet is to run off deposits. Thus, many institutions reduced their savings & checking dividend rates to NEGATIVE numbers....And here's the problem: When EVERYBODY is charging you to keep your money there, it doesn't make much sense to move it....so the effort was largely a bust. But it did happen.

[Aho Old Guy]

AZ ...
Secondary markets trade negative every day.

I can't point to the specific law, but the Treasury Dept/Fed is prohibited from trading negative.

I suspect there are Brainiacs out there with fancy logarithms whose sole purpose in life are mathematical inverse functions to force negative outcomes (resulting at "zero," or as close to it as they can possibly come).

[AZGrizFan]

AZ ...
Secondary markets trade negative every day.

I can't point to the specific law, but the Treasury Dept/Fed is prohibited from trading negative.

I suspect there are Brainiacs out there with fancy logarithms whose sole purpose in life are mathematical inverse functions to force negative outcomes (resulting at "zero," or as close to it as they can possibly come).

They (The Fed) got pretty damned close during that 8 year lull where they sat at 0%-0.25%....

[CAA Flagship]

Another strong monthly non-farm payroll report for February (although initial numbers are often revised).

December and January numbers were revised up bigly.

https://www.bls.gov/news.release/empsit.nr0.htm

[SDHornet]

[BDKJMU]

And yet all the media wants to talk about is the coronavirus..

[kalm]

And yet all the media wants to talk about is the coronavirus..

Except for Yahoo Finance which you just posted and several other media sources I've seen it on?

Is this also a form of TDS?

[Aho Old Guy]

Another strong monthly non-farm payroll report for February (although initial numbers are often revised).

December and January numbers were revised up bigly.

https://www.bls.gov/news.release/empsit.nr0.htm

[AZGrizFan]

Don't know what kind of math that is, but when not a SINGLE month is above 159,000, there's just no mathematical way the AVERAGE is 168,167/month.

I also question those numbers....they sure seem to be closely bunched...

[89Hen]

The underlined months add up to 1,894,324

[JohnStOnge]

I think this coronavirus thing may help Trump. I was hoping for an economic disturbance prior to the 2020 election. However, this is not optimum because Trump has a legitimate basis for saying "It wasn't MY fault." Regardless of who was President we would have an economic disturbance under these circumstances.

[Ivytalk]

I was hoping for an economic disturbance prior to the 2020 election.

Just like the Donk you are.