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InvisibleLunarEclipse
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September Rate Hike
    #22163618 - 08/30/15 07:26 AM (8 years, 4 months ago)

September rate hike coming September 17.  Strong GDP numbers at 3.7%, unemployment official numbers at 5.4%, inflation starting to perk up.

After all this hoopla and hand wringing, and after "nobody" sees it coming, there it is. 

And it won't be pretty.


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Invisiblememes
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Re: September Rate Hike [Re: LunarEclipse]
    #22163686 - 08/30/15 08:01 AM (8 years, 4 months ago)

i also think september is on the table, and should be, and will happen accordingly.  I think the market will have some consternation up until, and then after, it.


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InvisibleAhab McBathsalts
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Re: September Rate Hike [Re: memes] * 1
    #22163728 - 08/30/15 08:24 AM (8 years, 4 months ago)

Although MOST of this is already priced into the market, I was looking at a way to buy some USD or play the rate hike without getting roped into aggressive leveraged FOREX. Mostly as a way to store some US dollars for my winter vacation.

I was thinking about buying some call options on the TBT, or just simply buying a US CD, or a combination to reduce risk to an acceptable level.


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InvisibleStonehenge
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Re: September Rate Hike [Re: Ahab McBathsalts]
    #22163816 - 08/30/15 08:55 AM (8 years, 4 months ago)

I don't believe there will be any significant rate hike. Maybe a face saving tiny one but that's all. We will see, all the pundits say its coming and just me on the other side.


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“A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.” (attributed to Alexis de Tocqueville political philosopher Circa 1835)

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InvisibleAhab McBathsalts
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Re: September Rate Hike [Re: Stonehenge]
    #22163842 - 08/30/15 09:05 AM (8 years, 4 months ago)

I don't think will be a significant hike, but at the same time there are rumours of a Canadian rate cut in the same week in september.

I got some put options on FXC and will see how that works out for me.


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Invisiblememes
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Re: September Rate Hike [Re: Ahab McBathsalts]
    #22164653 - 08/30/15 12:38 PM (8 years, 4 months ago)

Quote:

Ahab McBathsalts said:
I don't think will be a significant



10 to 25 basis points, methinks.


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InvisibleAhab McBathsalts
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Re: September Rate Hike [Re: memes]
    #22165605 - 08/30/15 05:26 PM (8 years, 4 months ago)

After some careful consideration, I think I will just buy 1 put contract at 75.00 for 1.75 for the December 15th expiration for FXC.

This effectively hedges all my vacation money against Canadian dollar depreciation. The $73.25 breakeven amount hedges 10,000 CDN at $175 USD or a 2.3% cost. Many of us consider options as a form of leverage to make money, but they can actually used as effective hedges to lock in against currency depreciation for our personal lives.

As well as a few speculative puts in September just for fun.


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InvisibleLunarEclipse
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Re: September Rate Hike [Re: memes]
    #22192257 - 09/05/15 11:26 AM (8 years, 4 months ago)

Quote:

memes said:
i also think september is on the table, and should be, and will happen accordingly.  I think the market will have some consternation up until, and then after, it.




Looking more likely with the unemployment lie figure down to 5.1% and a falsified GDP number of 3.7%.  We are recovered! 

I've been thinking though that after the Shmita big drop on Monday the 14th that the 15th will/should be a day to take profits on 1/2 of my Home Depot puts that have hopefully doubled by then.  It's probably just paranoia, but not only could The Fed not raise rates, but start QE4 and just put a huge spike into the plans of the bears. 

Or not, it could drop like a stone after they raise rates, or drop if they don't raise rates.  But QE4, that would catch folks off guard.


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Invisiblememes
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Re: September Rate Hike [Re: LunarEclipse]
    #22192863 - 09/05/15 02:00 PM (8 years, 4 months ago)

with our economists saying QE was ineffective at best, and with the ECBC saying theirs isn't working, adn with the BOJ reaching the end of their ability to even have QE due to a lack of sellers; i don't expect QE4

all that having been said, i've seen crazier things


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InvisibleLunarEclipse
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Re: September Rate Hike [Re: memes]
    #22193886 - 09/05/15 06:13 PM (8 years, 4 months ago)

Quote:

memes said:
with our economists saying QE was ineffective at best, and with the ECBC saying theirs isn't working, adn with the BOJ reaching the end of their ability to even have QE due to a lack of sellers; i don't expect QE4

all that having been said, i've seen crazier things




If China keeps printing more yuan we may have to print more dollars or run the risk of really losing in the race to the bottom.


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InvisibleStonehenge
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Re: September Rate Hike [Re: LunarEclipse]
    #22193914 - 09/05/15 06:22 PM (8 years, 4 months ago)

Quote:

LunarEclipse said:
Quote:

memes said:
with our economists saying QE was ineffective at best, and with the ECBC saying theirs isn't working, adn with the BOJ reaching the end of their ability to even have QE due to a lack of sellers; i don't expect QE4

all that having been said, i've seen crazier things




If China keeps printing more yuan we may have to print more dollars or run the risk of really losing in the race to the bottom.




Its inevitable imo, no matter what china does. The only way, and I do mean the only way to pay off the nat debt is with devalued dollars.

I'm looking around now for ways to invest my cash that don't require a lot of work or risk. Lol, I guess everyone looks for that. A careful purchase might be a form of investment or at least avoiding higher prices later even if it does not return cash. If you have a mortgage, do not pay in advance, that works against you when cash becomes less valuable.


--------------------
“A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.” (attributed to Alexis de Tocqueville political philosopher Circa 1835)

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InvisibleLunarEclipse
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Re: September Rate Hike [Re: Stonehenge]
    #22195892 - 09/06/15 06:46 AM (8 years, 4 months ago)

Quote:

Stonehenge said:
Quote:

LunarEclipse said:
Quote:

memes said:
with our economists saying QE was ineffective at best, and with the ECBC saying theirs isn't working, adn with the BOJ reaching the end of their ability to even have QE due to a lack of sellers; i don't expect QE4

all that having been said, i've seen crazier things




If China keeps printing more yuan we may have to print more dollars or run the risk of really losing in the race to the bottom.




Its inevitable imo, no matter what china does. The only way, and I do mean the only way to pay off the nat debt is with devalued dollars.

I'm looking around now for ways to invest my cash that don't require a lot of work or risk. Lol, I guess everyone looks for that. A careful purchase might be a form of investment or at least avoiding higher prices later even if it does not return cash. If you have a mortgage, do not pay in advance, that works against you when cash becomes less valuable.




memes, let's not forget that even with no "official" QE program, we are still running hundreds of billions of dollars in fiscal deficits in the US alone each and every year.  QE didn't "work", nor will racking up more budget deficits.

Stoney, not paying your mortgage off makes sense for the most part, considering the interest is tax deductible. But, by not paying it off, for the most part, means not working your principal down very much at all, while paying a lot of money in interest.  If you have limited cash, and hold that cash in liquid dollars in your hand, rather than pay off your mortgage I think makes perfect sense.  In other words, don't give the bank your $10k or whatever it is when you may need it for food or other expenses.  But, if you have $300k sitting in a bank account earning 0.1% versus paying off your $150k mortgage at 4%, I think you should pay off your mortgage and get out of debt rather than hope inflation later saves your day.


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InvisibleStonehenge
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Re: September Rate Hike [Re: LunarEclipse]
    #22196173 - 09/06/15 08:42 AM (8 years, 4 months ago)

LE, that is the conventional wisdom you just gave which I would have said the same thing in the past. I did in fact pay off my mortgage early. That holds true in normal times but these times are not normal at all. We have seen a massive influx of qe which has not seemed to hit the street yet but it will. So far it has landed mostly in the stock market. More qe is coming, its all we have left when they quit buying our treasuries. What do you suppose that will create? Inflation of course.

If a high amount of inflation is coming, may not hit this year but who knows, then you have to adjust your strategy. Lets say you have a 100k mortgage and in your example 300k or whatever in the bank getting a low rate of interest. You can get a percent or more on cd's but the mortgage will be more than that. Why is it not a good idea to pay it off? Also not a good idea to buy cd's?

One thing you mentioned is the interest is deductible, if you itemize which many don't but some do. The other reason is $100k is worth $100k today, for reference purposes. 100k after inflation hits may be worth 90k next year in todays dollars based on buying power. That's a 10% drop in the value of your money which also mean the mortgage can be paid in cheaper dollars, a net savings to you.

Of course that means money sitting in the bank also loses value which is what I was talking about. Its better to invest it in something solid or even to make purchases today rather than next year when prices will be higher and your money doesn't go as far.

So the guy who invests his spare cash rather than pay down the mortgage, sees the value of his investments go up along with inflation while his mortgage is in fixed dollars that are easier to pay back. If things go really haywire, as many have said including myself and I think you as well, then the 100k mortgage is still 100k but your investment is worth a lot more. A dollar in a few years might be worth 50 cents in todays money. If you had paid it off with today's more valuable dollars instead of investing them, you would not have the investment which in that future time will be worth 200k based on inflation alone not even figuring in the fact that you may have invested wisely and gotten returns or greater appreciation than that.

When inflation is low and the outlook is for low inflation, then paying it off early makes sense. Can you tell me the outlook is for low inflation going on into the future with all this crap going down, with all that debt owed? When the stuff hits the fan, all govt will have left is that blank check known as create more money out of thin air or qe. And since other govts will be doing the same, and are doing it right now in fact, that puts even more pressure on us to do it.

I still lol at those who say the fed will make a significant hike in rates soon. Janet is yellin' about it to jawbone the economy but it won't happen. Our 18 - $19T debt can't take an interest rate hike. The can of worms would burst open a lot sooner if that happens. And if we are insolvent, what is the remedy? QE of course or maybe under a new name, a new shuffling of the shells to hide the pea from the customer.


--------------------
“A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.” (attributed to Alexis de Tocqueville political philosopher Circa 1835)

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InvisibleLunarEclipse
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Re: September Rate Hike [Re: Stonehenge]
    #22202171 - 09/07/15 01:35 PM (8 years, 4 months ago)

What you are going to see way before the inflationary period, is continued deflation of currencies and appreciation of the USD, particularly if the rate hike truly does take place this September.  Europe this week opened the money spigots and continue to be in trouble.  China seems to think they can control the death spiral of a market they created, to no avail.  As long as the big players are in their market, the onslaught down will continue.

Because of the stronger dollar, the stock market will swoon even further as it finally becomes completely obvious that earnings will take a double whammy along with a global economy now in contraction.

I don't believe any of the government numbers, the economy is and has been in contraction for months now.  It's going to get a lot worse.

The real danger is credit/liquidity completely dries up in the big economy like in 2008.  This time bail outs won't do jack shit.  Expect the big bail ins (stealing of money from savers).  Then what good does inflation do you when "they" just gave you a 40% account "haircut"?


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InvisibleStonehenge
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Re: September Rate Hike [Re: LunarEclipse]
    #22202277 - 09/07/15 01:53 PM (8 years, 4 months ago)

Agreed. The deflation may have run its course, we never know until later naturally. China is hooked on govt control, they think they can command the tides or something. I still think no rate bump in sept, I think its all a bluff. At most a token raise, nothing to worry about and if any bad news comes along that will be the excuse not to do it.

>I don't believe any of the government numbers, the economy is and has been in contraction for months now.  It's going to get a lot worse.

Of course, we have an incompetent goof in charge who has done nothing but lie from the get go. I just read we have the lowest labor participation rate in 38 years. That is despite the fact most women work now and years ago most didn't. Yet the moonbats brag about "low" unemployment.

A Cyprus style bail in? I would not put it past them with the blessings of obumble of course. That and worries about coming inflation makes me not want to have too much in the bank. Not in an account anyway. A safe deposit box costs little and its hard to give a haircut to the box. I do believe there is a precedent even for that though.


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“A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.” (attributed to Alexis de Tocqueville political philosopher Circa 1835)

Trade list http://www.shroomery.org/forums/showflat.php/Number/18047755


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InvisibleLunarEclipse
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Re: September Rate Hike [Re: Stonehenge]
    #22202322 - 09/07/15 02:02 PM (8 years, 4 months ago)

If you have anything in a safety deposit box at a bank, that's a big mistake.  Do your heirs a favor if nothing else, if you die prematurely they will have a hell of a time getting that money, and it will be taxed at a minimum via probate.

The last real "banking holiday" period back in the last depression, the safety deposit box contents were given more than a haircut, they were just plain stolen.  Your faith in the banking "system" surprises me.

If you are into charts at all, check out the one, five and ten year charts of the S&P 500 compared to the Shanghai Composite Index.  The five year chart is of particular interest.  Can you seriously tell me we aren't heading into a deflationary slide/complete hammering of stock prices in the US?  Note how the two markets peaked exactly at the same time this summer, with the Chinese market already off 40% and heading far lower.  History will be repeating itself. 

Now add Home Depot into the mix.  Amazing 5 year run up based on what?  The housing market?  Ha ha ha.  No, borrowing money to buy back shares.  That will not be ending well for them with the very first supply disruption from China given the impending trade war/sanctions/tariffs.


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InvisibleStonehenge
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Re: September Rate Hike [Re: LunarEclipse]
    #22202392 - 09/07/15 02:18 PM (8 years, 4 months ago)

>The last real "banking holiday" period back in the last depression, the safety deposit box contents were given more than a haircut, they were just plain stolen.  Your faith in the banking "system" surprises me.

Perhaps you missed this part of my post

"A safe deposit box costs little and its hard to give a haircut to the box. I do believe there is a precedent even for that though."

>Can you seriously tell me we aren't heading into a deflationary slide/complete hammering of stock prices in the US?

Stocks are being hammered as we speak. That is disconnected from de/in flation, the price of stocks bears little correlation with consumer prices. Witness the huge runup in stock values during the last 6 years vs very little inflation. Oil has tumbled but recently went back up quite a bit. Its still relatively cheap though, enjoy it while you can.

I agree storm clouds are gathering, they have been for a while but the collapse may be near rather than an orderly process. China clearly can't turn back the tide and neither can usa. Europe is nearly a basket case and some of its countries already are, as we all know.

I think a sd box is safer than storing valuables in your home or burying them in the yard or some nutty thing like that. Even a home safe is not that safe. You better hope its too heavy to move and that you can chain it to something even heavier. A safe costs a lot, a box is cheap and can be emptied rapidly if stuff hits the fan hard. A determined burglar can carry a portable cutting torch easily along with other tools for getting through whatever layers your safe has. Most are just cheap thin sheet metal with no barrier to a torch. A damn can opener can almost crack a cheap one and a good one just takes the right tools.


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“A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.” (attributed to Alexis de Tocqueville political philosopher Circa 1835)

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InvisibleLunarEclipse
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Re: September Rate Hike [Re: Stonehenge]
    #22202433 - 09/07/15 02:31 PM (8 years, 4 months ago)

The whole point of the run up in stocks is that it's an inflationary bubble about to burst.  Likewise, real estate is going down down down.  There are a number of factors for this, but basically "easy money" (not to you or me, to the big banks etc.) has driven stocks to ridiculous levels.  Given the limited "choices" of zero or near zero percent interest rates, may people particularly in their retirement plans, have opted for either stocks or some in bonds.  Both are ridiculously overvalued by any metric, particularly given the global economy contraction. 

Look at it this way, even with the enormous amount of funny money, near zero interest rates, and the endless droning by the MSM about how "robust" the housing market is, and how much we are in recovery, the housing market only barely approaches 2006 levels.  Worse, the foreclosures and shadow foreclosures are looming, many never recovered from 2008 and are deep underwater and something like 5 million haven't made a payment in over a year yet the banks do nothing.  Even worse, hedge funds and the idiot Chinese piled into US housing thinking it was safe after their housing market has been tanking.

It's all going to end, the entire house of cards is going to come crashing down.  When you can't even get into your bank to access your safe deposit box, you'll see what I'm talking about.  They may let you use your ATM to pull out $100 a day, you hope.  To let you inside? No. That box is frozen pending a search to see if it contains now illegal gold and silver.  Oh, it does?  Too bad.  You lose.


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InvisibleStonehenge
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Re: September Rate Hike [Re: LunarEclipse]
    #22202496 - 09/07/15 02:49 PM (8 years, 4 months ago)

>The whole point of the run up in stocks is that it's an inflationary bubble about to burst.

I agree, stocks are way overpriced and will tumble a lot, "crash" will be the best word.

>Likewise, real estate is going down down down.

I don't know where you get that info from. In my area sales are booming and prices are rising. Reports from many parts of the country are similar

Very true about foreclosures and people being underwater. But the only way we will have a big price reduction in r/e is if deflation picks up speed and takes off coupled with a movement away from buying. Which is what I see you are rooting for. Some deflation will continue but not as long or as much as you may wish for. The stock market crashing is much more likely.

>When you can't even get into your bank to access your safe deposit box, you'll see what I'm talking about.

Very unlikely indeed. In the depression, banks were not insured and went under closing their doors. Things are different now. Also, they have not passed any laws against possessing gold or silver, as you seem to dream of, nor having large amounts of cash. That would have to come first before they could look into the boxes and confiscate stuff. It will not be a stealth thing, there would be tons of reasurrances for the sheep to keep them calm but those in the know will see the handwriting and understand what to do.

I take it you don't like pm's either? Good luck on your depot shorts, hopefully it crashes before you have to cover.


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“A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.” (attributed to Alexis de Tocqueville political philosopher Circa 1835)

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Re: September Rate Hike [Re: Stonehenge]
    #22203251 - 09/07/15 05:21 PM (8 years, 4 months ago)

Lunar can u speak your mind for once?
Lol Lunar, I have a real question I was kidding before.
LunarEclipse Have u got any ideas how to handle this maybe like a point form list like how to cook something in the oven?


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in waiting for my rebirth cycle i have hopes that when mushrooms find me it will occur then and i can go about the world as a medicine man
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a journeyman of nature soon to be stepping up to novice hopefully i will have time to become an expert, and i believe only in death will i become a master


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