You may yet see your 10% if they trigger the stops at 2xSpartas...
Same here. Out of powder. We broke this morning’s low, as well as Feb 23rd. I’m not a technical guru, but that sounds bad and the bottom is much lower.Bought the dip....... I’m peanuts for dry powder got 1 additional.... for the cause
Paging @Artful Dodger for QOTD. Seeing this price action, I thought about hiding in a hole today, but instead I’ll start planting the garden because I might just need that food to survive.I really think this is that big moment of truth where ALL people in finance as well as retail decides what is a big deal and what isn’t.
I mean, somebody smarter than me must know the answer to this question, right?
Knowing that the US Government will sell an enormous amount of treasuries next week to fund the bill, how can the Fed let yield shoot up like this?
Fed Chair Powell Notes:
- Congress has given them two goals: max employment and price stability
- Today: economy began to recover may'20 with good progress into beg fall; then progress slowed with winter covid; still a long way from goal;
- Good reason to see job creation pick up (10MM fewer people working vs before COVID)
- Inflation: currently running below 2%; to move up as economy reopens and surge in spending; have tools to anchor long run inflation at 2%
- Max employment: wants to see wages moving up, gains in employment are broad based across demographics (labor force participation metric) rather than relying on unemployment metric (excludes people who have stopped looking for work for various reasons - company closed, etc)
- Does not think that max employment will be achieved this year, employment recovery hasn't happened yet
- Asset purchases will continue at current level until substantial actual progress towards goal - it would take some time to achieve
- Economy is a long ways away from raising rates
- If they do see what they believe a transitory increase in long term inflation: he expects the Fed to be patient
- As it relates to bond markets: would be concerned if they see disorderly market or liquidity tightening
- Fed policies are outcome based (ie. wait for actual conditions to occur before raising rates)
- Expects inflation to raise on re-opening but views this as transient (one time event)
- Intends to use tools to anchor long term inflation at 2%
- High inflation is very bad - hurts people with low/fixed incomes; Fed will not allow this to happen as with previous Fed administrations in the 60s/70s
- Missed last 3 mins (had to pee)
TL;DR: Asset purchases and low rates to be maintained until max employment has been achieved. Fed to use tools to peg long term inflation at 2%. Short term/transitory inflation is not a concern. Watching bond markets carefully will act if market is disorderly or liquidity is constrained - suggests they will observe, along with a broad range of markets, before acting. Fed will fight high inflation.
I guess he stayed on point and didn't say anything inflammatory in either direction. Bond yields increased during speech on perceived lack of Fed intervention?