@Overdate said:
Okay, say the interest rate on a treasury note rises to 50%. You have a bunch of gold. Do you:
Keep all the gold because the link between interest rates and gold is an "unsubstantiated legend"?
--or--
Trade at least some of your gold for treasury notes to capture the higher interest rate?
The paper you are citing has numerous flaws, such as already assuming as true what it is trying to prove: "The US dollar index is obviously influencing gold prices" (page 1). I'll have more to say on it later.
Depends on the inflation rate. If it’s over 50%, which I assume it’d need to be to have a 50% IR, I’d keep all the gold.
I was using an extreme example to point out the obvious: when interest rates rise, dollars become more attractive >relative to gold. When the interest rate on treasury securities rose from zero to 4.5%, I’m sure quite a few people >bought t-bills or bank CDs rather than gold (which they would have otherwise bought if interest rates had remained >at zero).
At various times, gold has a direct or indirect correlation to interest rates, nominal and real.
Variables change over time. The 1970's are not the 2020's. 1994 is different, too.
@Overdate said:
Okay, say the interest rate on a treasury note rises to 50%. You have a bunch of gold. Do you:
Keep all the gold because the link between interest rates and gold is an "unsubstantiated legend"?
--or--
Trade at least some of your gold for treasury notes to capture the higher interest rate?
The paper you are citing has numerous flaws, such as already assuming as true what it is trying to prove: "The US dollar index is obviously influencing gold prices" (page 1). I'll have more to say on it later.
The scenario you cite is an abnormal economic condition, probably an economic crisis of some sort. In such situation nothing is predictable or reliable.
I was using an extreme example to point out the obvious: when interest rates rise, dollars become more attractive relative to gold. When the interest rate on treasury securities rose from zero to 4.5%, I’m sure quite a few people bought t-bills or bank CDs rather than gold (which they would have otherwise bought if interest rates had remained at zero).
A monthly dataset from 1994 to 2024 shows a slight negative correlation (-0.178) between the U.S. dollar index and the price of gold. But the dollar index itself is at 104, the same as it was at the beginning of 2000 when gold was sitting at $284. Obviously this weak correlation is transient in nature and does not hold up over the long term.
Nothing happens in a vacuum. Now you see how market dynamics such as a really high interest rate, the introduction of gold ETFs, a global pandemic, or a big financial collapse can aberrate market relationships that generally hold during "normal economic times" and make it difficult to see or rely on relationships such as the US Dollar to gold.
Perhaps it'd be easier to see if you priced gold in silver. Currently gold ~= 83.7x silver. If gold were to maintain value but a shortage of silver suddenly happened (thus increasing the value of silver), you'd see the silver price of gold drop. The US Dollar is no different.
@ProofCollection said:
Perhaps it'd be easier to see if you priced gold in silver. Currently gold ~= 83.7x silver. If gold were to maintain value but a shortage of silver suddenly happened (thus increasing the value of silver), you'd see the silver price of gold drop. The US Dollar is no different.
Never said it was. It's the dollar index, not the dollar itself, that we were discussing.
As far as the dollar itself is concerned, higher interest rates will make t-bills more attractive in relation to gold, regardless of what other circumstances might exist. If a new ETF, pandemic or financial collapse happen to occur, it still remains true that t-bills at a higher interest rate will be more attractive to investors/savers than t-bills at a lower or zero interest rate.
@ProofCollection said:
Perhaps it'd be easier to see if you priced gold in silver. Currently gold ~= 83.7x silver. If gold were to maintain value but a shortage of silver suddenly happened (thus increasing the value of silver), you'd see the silver price of gold drop. The US Dollar is no different.
Never said it was. It's the dollar index, not the dollar itself, that we were discussing.
As far as the dollar itself is concerned, higher interest rates will make t-bills more attractive in relation to gold, regardless of what other circumstances might exist. If a new ETF, pandemic or financial collapse happen to occur, it still remains true that t-bills at a higher interest rate will be more attractive to investors/savers than t-bills at a lower or zero interest rate.
Then you have to realize that there's a relationship to movements in the dollar index to the value of the dollar, and that the index is relative and not absolute so comparisons to prices decades ago is pointless, right?
the Dow Jones Industrial Average is a index of 30 stocks.
the dollar index is relative to weighted values of 6 other currencies
where the $ index takes a turn with respect to inflation and declining purchasing power is shown in the recent 9% inflation craze. other countries had worse inflation, but eh, the dollar index didn't skyrocket or crash dive then. however, the purchasing power of the dollar declined ... and still is declining
(and in fact, since the beginning of the year, the dollar index has gained strength)
i'll go on to say that the dollar index is neither near its high or low, yet ever since inception in like 1999, the purchasing power has been declining.
What will interest rate cuts do to currently climbing gold prices?
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
@ProofCollection said:
Perhaps it'd be easier to see if you priced gold in silver. Currently gold ~= 83.7x silver. If gold were to maintain value but a shortage of silver suddenly happened (thus increasing the value of silver), you'd see the silver price of gold drop. The US Dollar is no different.
Never said it was. It's the dollar index, not the dollar itself, that we were discussing.
As far as the dollar itself is concerned, higher interest rates will make t-bills more attractive in relation to gold, regardless of what other circumstances might exist. If a new ETF, pandemic or financial collapse happen to occur, it still remains true that t-bills at a higher interest rate will be more attractive to investors/savers than t-bills at a lower or zero interest rate.
Then you have to realize that there's a relationship to movements in the dollar index to the value of the dollar, and that the index is relative and not absolute so comparisons to prices decades ago is pointless, right?
Not if, as you earlier claimed, "the USD index is highly inverse correlated to the price of gold." I have demonstrated that the inverse correlation is weak on a monthly basis and nonexistent over the long term.
@ProofCollection said:
Perhaps it'd be easier to see if you priced gold in silver. Currently gold ~= 83.7x silver. If gold were to maintain value but a shortage of silver suddenly happened (thus increasing the value of silver), you'd see the silver price of gold drop. The US Dollar is no different.
Never said it was. It's the dollar index, not the dollar itself, that we were discussing.
As far as the dollar itself is concerned, higher interest rates will make t-bills more attractive in relation to gold, regardless of what other circumstances might exist. If a new ETF, pandemic or financial collapse happen to occur, it still remains true that t-bills at a higher interest rate will be more attractive to investors/savers than t-bills at a lower or zero interest rate.
Then you have to realize that there's a relationship to movements in the dollar index to the value of the dollar, and that the index is relative and not absolute so comparisons to prices decades ago is pointless, right?
Not if, as you earlier claimed, "the USD index is highly inverse correlated to the price of gold." I have demonstrated that the inverse correlation is weak on a monthly basis and nonexistent over the long term.
@ProofCollection said:
Perhaps it'd be easier to see if you priced gold in silver. Currently gold ~= 83.7x silver. If gold were to maintain value but a shortage of silver suddenly happened (thus increasing the value of silver), you'd see the silver price of gold drop. The US Dollar is no different.
Never said it was. It's the dollar index, not the dollar itself, that we were discussing.
As far as the dollar itself is concerned, higher interest rates will make t-bills more attractive in relation to gold, regardless of what other circumstances might exist. If a new ETF, pandemic or financial collapse happen to occur, it still remains true that t-bills at a higher interest rate will be more attractive to investors/savers than t-bills at a lower or zero interest rate.
Then you have to realize that there's a relationship to movements in the dollar index to the value of the dollar, and that the index is relative and not absolute so comparisons to prices decades ago is pointless, right?
Not if, as you earlier claimed, "the USD index is highly inverse correlated to the price of gold." I have demonstrated that the inverse correlation is weak on a monthly basis and nonexistent over the long term.
If you say so.
If you look at your own chart, you will see that about 1/3 of the time the two lines are moving in the same direction. And if you extend it out one more year (to present day), you will find that the U.S. Dollar Index (blue line) is essentially flat (at around 104), while the price of gold (gold line) is literally off the chart at about $2350.
If the two were really that strongly inversely correlated, it would be as profitable over time to short the dollar index as it would be to buy gold. Clearly that's not the case.
@ProofCollection said:
Perhaps it'd be easier to see if you priced gold in silver. Currently gold ~= 83.7x silver. If gold were to maintain value but a shortage of silver suddenly happened (thus increasing the value of silver), you'd see the silver price of gold drop. The US Dollar is no different.
Never said it was. It's the dollar index, not the dollar itself, that we were discussing.
As far as the dollar itself is concerned, higher interest rates will make t-bills more attractive in relation to gold, regardless of what other circumstances might exist. If a new ETF, pandemic or financial collapse happen to occur, it still remains true that t-bills at a higher interest rate will be more attractive to investors/savers than t-bills at a lower or zero interest rate.
The prevailing inflation rate also comes into play.
Bonds are not as attractive if the Dollar is losing purchasing power at a rate that exceeds the interest rate on the bonds.
@dcarr said:
High housing prices plus higher interest rates results in more debt servitude.
Except debt servicing is way down from the norm since 1980:
Going from "10.6%" to "9.9%" is not "way down".
For those that want to buy a house -
In recent years home prices have not generally declined.
But mortgage rates have definitely gone up.
That means the typical buyer will have to pay more in financing costs.
@ProofCollection said:
Perhaps it'd be easier to see if you priced gold in silver. Currently gold ~= 83.7x silver. If gold were to maintain value but a shortage of silver suddenly happened (thus increasing the value of silver), you'd see the silver price of gold drop. The US Dollar is no different.
Never said it was. It's the dollar index, not the dollar itself, that we were discussing.
As far as the dollar itself is concerned, higher interest rates will make t-bills more attractive in relation to gold, regardless of what other circumstances might exist. If a new ETF, pandemic or financial collapse happen to occur, it still remains true that t-bills at a higher interest rate will be more attractive to investors/savers than t-bills at a lower or zero interest rate.
Then you have to realize that there's a relationship to movements in the dollar index to the value of the dollar, and that the index is relative and not absolute so comparisons to prices decades ago is pointless, right?
Not if, as you earlier claimed, "the USD index is highly inverse correlated to the price of gold." I have demonstrated that the inverse correlation is weak on a monthly basis and nonexistent over the long term.
If you say so.
If you look at your own chart, you will see that about 1/3 of the time the two lines are moving in the same direction. And if you extend it out one more year (to present day), you will find that the U.S. Dollar Index (blue line) is essentially flat (at around 104), while the price of gold (gold line) is literally off the chart at about $2350.
If you say so.
If the two were really that strongly inversely correlated, it would be as profitable over time to short the dollar index as it would be to buy gold. Clearly that's not the case.
You are over simplifying. Shorting the dollar index when the dollar index is going down would be profitable buying gold. Trading is difficult and timing is everything. Looking at my chart, if you caught all of the moves I highlighted, you would have made good money.
Uhh...after today's CPI number, you can stop worrying about rate cuts !!
Maybe not if Powell looks for self preservation vs. what is right »
I strongly agree with @GoldFinger1969. A fair assessment of Powell’s time at the Fed shows that he tends to do what is right in the face of political pressure. He is concerned with his legacy and does not want to be the next Arthur Burns. However, our elected friends in Washington have dealt him a difficult hand. In any case, he has made it clear that he believes inflation is proving to be stubborn, and that our insatiable appetite for deficit spending is a significant issue. Don’t expect lower interest rates from the Fed in the near future.
Starting to see people talk about gold on CNBC, FBC, and Bloomberg TV. But it is NOT leading off the segments...no Gold Bugs or Super Bulls touting ridiculous PTs.
@ProofCollection said:
Perhaps it'd be easier to see if you priced gold in silver. Currently gold ~= 83.7x silver. If gold were to maintain value but a shortage of silver suddenly happened (thus increasing the value of silver), you'd see the silver price of gold drop. The US Dollar is no different.
Never said it was. It's the dollar index, not the dollar itself, that we were discussing.
As far as the dollar itself is concerned, higher interest rates will make t-bills more attractive in relation to gold, regardless of what other circumstances might exist. If a new ETF, pandemic or financial collapse happen to occur, it still remains true that t-bills at a higher interest rate will be more attractive to investors/savers than t-bills at a lower or zero interest rate.
Then you have to realize that there's a relationship to movements in the dollar index to the value of the dollar, and that the index is relative and not absolute so comparisons to prices decades ago is pointless, right?
Not if, as you earlier claimed, "the USD index is highly inverse correlated to the price of gold." I have demonstrated that the inverse correlation is weak on a monthly basis and nonexistent over the long term.
If you say so.
If you look at your own chart, you will see that about 1/3 of the time the two lines are moving in the same direction. And if you extend it out one more year (to present day), you will find that the U.S. Dollar Index (blue line) is essentially flat (at around 104), while the price of gold (gold line) is literally off the chart at about $2350.
If you say so.
If the two were really that strongly inversely correlated, it would be as profitable over time to short the dollar index as it would be to buy gold. Clearly that's not the case.
You are over simplifying. Shorting the dollar index when the dollar index is going down would be profitable buying gold. Trading is difficult and timing is everything. Looking at my chart, if you caught all of the moves I highlighted, you would have made good money.
>
Shorting any financial asset only when it is going down would be profitable. As you say, trading is difficult and timing is everything. Gold is more typically acquired as part of a buy-and-hold strategy, and for this strategy buying and holding gold is clearly superior to buying and holding a financial instrument tied to the U.S. Dollar Index.
Your chart begins in 2013, as gold is heading to post-recession multi-year lows and the Dollar Index is at the lower end of its long-term range. Your chart ends in 2023, just before gold makes a major move to its current price of $2300+. Clearly the time frame selected has a dominant influence on what the chart will show.
The U.S. Dollar Index was created in March 1973 (per Wikipedia), with the Index at 100 and the price of gold at $83 per ounce. Today the Dollar Index is 105 (up 5% in 51 years) and gold is at $2327 (up 2703% in 51 years). Tell me which financial instrument you would rather have held during the past half century.
And to think, there are a very few here who want to believe strong gold equals strong dollar/economy. LOL
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
@derryb said:
And to think, there are a very few here who want to believe strong gold equals strong dollar/economy. LOL
The USD index is sitting north of 105, historically high. The economy is on fire, salaries are up and it's very hard to find an asset class that is not in/near record territory. The Au is at alltime highs. It's not that hard to understand. BOOMIN! RGDS!
USD index is meaningless if you are spending dollars. Prices are on fire, salaries cannot keep up.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I’m tempted to sell some gold and buy treasuries or munis intermediate term
i'm converting some gold into Ethereum
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I'm not expecting interest rates to go down much.
But if stresses in the banking system increase (which I think is very possible with rates staying higher for longer), I think the Federal Reserve would do more QE behind the scenes rather than lowering interest rates.
@cohodk said:
Gold is up 10 fold in the 40+ years and US Gdp is up 10 fold in the last 40+ years.
U.S. Gross Domestic Product is not a good proxy for the wealth or income of its people. GDP includes government spending, so weapons, welfare payments and government employee salaries are considered equal to a consumer buying a new car, new house, television set or groceries. Also, as the population grows, GDP per capita (per person) goes down.
@cohodk said:
Gold is up 10 fold in the 40+ years and US Gdp is up 10 fold in the last 40+ years.
U.S. Gross Domestic Product is not a good proxy for the wealth or income of its people. GDP includes government spending, so weapons, welfare payments and government employee salaries are considered equal to a consumer buying a new car, new house, television set or groceries. Also, as the population grows, GDP per capita (per person) goes down.
My point is to address derryb in that gold is just like any other major asset class and has performed similarly (less) over the last roughly 50 years. It is not some sort of "fear gauge".
@dcarr said:
I'm not expecting interest rates to go down much.
But if stresses in the banking system increase (which I think is very possible with rates staying higher for longer), I think the Federal Reserve would do more QE behind the scenes rather than lowering interest rates.
@dcarr said:
I'm not expecting interest rates to go down much.
But if stresses in the banking system increase (which I think is very possible with rates staying higher for longer), I think the Federal Reserve would do more QE behind the scenes rather than lowering interest rates.
Do you think interest rates are high?
.
Demographics do not support rates at this level.
But all the money that has been created in recent years needs a home and the Federal Reserve wants that home to be bonds.
The problem is, higher interest payments made by the government means there is even more money that needs to find a home.
@dcarr said:
I'm not expecting interest rates to go down much.
But if stresses in the banking system increase (which I think is very possible with rates staying higher for longer), I think the Federal Reserve would do more QE behind the scenes rather than lowering interest rates.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
as always, baby steps. Their choice of direction is much more powerful than the amount.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I’m more interested in derryb’s view of timing than magnitude. Prediction of a cut by the end of June would be bold. Prediction of a cut in 2024 less so.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Comments
Depends on the inflation rate. If it’s over 50%, which I assume it’d need to be to have a 50% IR, I’d keep all the gold.
Nothing is as expensive as free money.
At various times, gold has a direct or indirect correlation to interest rates, nominal and real.
Variables change over time. The 1970's are not the 2020's. 1994 is different, too.
Nothing happens in a vacuum. Now you see how market dynamics such as a really high interest rate, the introduction of gold ETFs, a global pandemic, or a big financial collapse can aberrate market relationships that generally hold during "normal economic times" and make it difficult to see or rely on relationships such as the US Dollar to gold.
Perhaps it'd be easier to see if you priced gold in silver. Currently gold ~= 83.7x silver. If gold were to maintain value but a shortage of silver suddenly happened (thus increasing the value of silver), you'd see the silver price of gold drop. The US Dollar is no different.
Never said it was. It's the dollar index, not the dollar itself, that we were discussing.
As far as the dollar itself is concerned, higher interest rates will make t-bills more attractive in relation to gold, regardless of what other circumstances might exist. If a new ETF, pandemic or financial collapse happen to occur, it still remains true that t-bills at a higher interest rate will be more attractive to investors/savers than t-bills at a lower or zero interest rate.
My Adolph A. Weinman signature
Then you have to realize that there's a relationship to movements in the dollar index to the value of the dollar, and that the index is relative and not absolute so comparisons to prices decades ago is pointless, right?
to further the distinction:
the Dow Jones Industrial Average is a index of 30 stocks.
the dollar index is relative to weighted values of 6 other currencies
where the $ index takes a turn with respect to inflation and declining purchasing power is shown in the recent 9% inflation craze. other countries had worse inflation, but eh, the dollar index didn't skyrocket or crash dive then. however, the purchasing power of the dollar declined ... and still is declining
(and in fact, since the beginning of the year, the dollar index has gained strength)
i'll go on to say that the dollar index is neither near its high or low, yet ever since inception in like 1999, the purchasing power has been declining.
What will interest rate cuts do to currently climbing gold prices?
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Except debt servicing is way down from the norm since 1980:
Up another $12 in overenight, $2,375.
This move in gold is reminiscent of gold's moves in 1972-74, 1976-78, 2001-06, and 2016-20.
But it's stronger than most of them. The 1970's markets in terms going up relentlessly. Not as violent, but as persistent.
Not if, as you earlier claimed, "the USD index is highly inverse correlated to the price of gold." I have demonstrated that the inverse correlation is weak on a monthly basis and nonexistent over the long term.
My Adolph A. Weinman signature
If you say so.
If you look at your own chart, you will see that about 1/3 of the time the two lines are moving in the same direction. And if you extend it out one more year (to present day), you will find that the U.S. Dollar Index (blue line) is essentially flat (at around 104), while the price of gold (gold line) is literally off the chart at about $2350.
If the two were really that strongly inversely correlated, it would be as profitable over time to short the dollar index as it would be to buy gold. Clearly that's not the case.
My Adolph A. Weinman signature
The prevailing inflation rate also comes into play.
Bonds are not as attractive if the Dollar is losing purchasing power at a rate that exceeds the interest rate on the bonds.
Going from "10.6%" to "9.9%" is not "way down".
For those that want to buy a house -
In recent years home prices have not generally declined.
But mortgage rates have definitely gone up.
That means the typical buyer will have to pay more in financing costs.
the dollar index is stronger so far today. took a big jump on the cpi news
Uhh...after today's CPI number, you can stop worrying about rate cuts !!
Maybe not if Powell looks for self preservation vs. what is right
If you say so.
You are over simplifying. Shorting the dollar index when the dollar index is going down would be profitable buying gold. Trading is difficult and timing is everything. Looking at my chart, if you caught all of the moves I highlighted, you would have made good money.
Gold has a massive bid underneath....turning positive with risk-on and risk-off assets getting hit.
@Psuman58 said:
“@GoldFinger1969 said:
Uhh...after today's CPI number, you can stop worrying about rate cuts !!
Maybe not if Powell looks for self preservation vs. what is right »
I strongly agree with @GoldFinger1969. A fair assessment of Powell’s time at the Fed shows that he tends to do what is right in the face of political pressure. He is concerned with his legacy and does not want to be the next Arthur Burns. However, our elected friends in Washington have dealt him a difficult hand. In any case, he has made it clear that he believes inflation is proving to be stubborn, and that our insatiable appetite for deficit spending is a significant issue. Don’t expect lower interest rates from the Fed in the near future.
BOA hikes their gold price to $2,500 by Q4.
Starting to see people talk about gold on CNBC, FBC, and Bloomberg TV. But it is NOT leading off the segments...no Gold Bugs or Super Bulls touting ridiculous PTs.
Slow and steady with a bid underneath.
>
Shorting any financial asset only when it is going down would be profitable. As you say, trading is difficult and timing is everything. Gold is more typically acquired as part of a buy-and-hold strategy, and for this strategy buying and holding gold is clearly superior to buying and holding a financial instrument tied to the U.S. Dollar Index.
Your chart begins in 2013, as gold is heading to post-recession multi-year lows and the Dollar Index is at the lower end of its long-term range. Your chart ends in 2023, just before gold makes a major move to its current price of $2300+. Clearly the time frame selected has a dominant influence on what the chart will show.
The U.S. Dollar Index was created in March 1973 (per Wikipedia), with the Index at 100 and the price of gold at $83 per ounce. Today the Dollar Index is 105 (up 5% in 51 years) and gold is at $2327 (up 2703% in 51 years). Tell me which financial instrument you would rather have held during the past half century.
My Adolph A. Weinman signature
And to think, there are a very few here who want to believe strong gold equals strong dollar/economy. LOL
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
The USD index is sitting north of 105, historically high. The economy is on fire, salaries are up and it's very hard to find an asset class that is not in/near record territory. The Au is at alltime highs. It's not that hard to understand. BOOMIN! RGDS!
USD index is meaningless if you are spending dollars. Prices are on fire, salaries cannot keep up.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Gold is up 10 fold in the 40+ years and US Gdp is up 10 fold in the last 40+ years.
Real estate is up a little less and stocks up a bit more.
So, to say gold is not up because of a strong economy, in the face of other economically influenced assets, would probably need some reprogramming.
Knowledge is the enemy of fear
I dunno
I’m tempted to sell some gold and buy treasuries or munis intermediate term
I give away money. I collect money.
I don’t love money . I do love the Lord God.
i'm converting some gold into Ethereum
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I'm not expecting interest rates to go down much.
But if stresses in the banking system increase (which I think is very possible with rates staying higher for longer), I think the Federal Reserve would do more QE behind the scenes rather than lowering interest rates.
U.S. Gross Domestic Product is not a good proxy for the wealth or income of its people. GDP includes government spending, so weapons, welfare payments and government employee salaries are considered equal to a consumer buying a new car, new house, television set or groceries. Also, as the population grows, GDP per capita (per person) goes down.
My Adolph A. Weinman signature
Per capita GDP is also up nearly 10 fold.
https://www.macrotrends.net/global-metrics/countries/USA/united-states/gdp-gross-domestic-product
My point is to address derryb in that gold is just like any other major asset class and has performed similarly (less) over the last roughly 50 years. It is not some sort of "fear gauge".
Knowledge is the enemy of fear
Do you think interest rates are high?
Knowledge is the enemy of fear
Do you think interest rates are high?
Do you think that Paul Volcker raised rates high?
I knew it would happen.
.
Demographics do not support rates at this level.
But all the money that has been created in recent years needs a home and the Federal Reserve wants that home to be bonds.
The problem is, higher interest payments made by the government means there is even more money that needs to find a home.
.
I think he raised rates to the highest level the USA has ever seen. Today's rates appear to be at or even below historical average.
https://advisor.visualcapitalist.com/us-interest-rates/
What do you think?
Knowledge is the enemy of fear
>
Not sure what you mean? Can you explain?
Knowledge is the enemy of fear
I think rates want to go higher.
I knew it would happen.
Opportunity!! Ive got my eye on some long-term AAAs!!
Knowledge is the enemy of fear
That doesn’t mean opportunity simply because the Fed is always involved in rate manipulation. The only opportunity exists for insiders.
I knew it would happen.
look for FED to cut rates.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Well, don't know what to tell ya. I see lots of opportunities. I guess a little knowledge goes a long way.
Knowledge is the enemy of fear
How much? 25bps, 250bps, 500bps?
Knowledge is the enemy of fear
as always, baby steps. Their choice of direction is much more powerful than the amount.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Don't forget, sideways is a direction.
Knowledge is the enemy of fear
@derryb said: “look for FED to cut rates.”
I’m more interested in derryb’s view of timing than magnitude. Prediction of a cut by the end of June would be bold. Prediction of a cut in 2024 less so.
by end of june
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
NOMINAL or REAL rates are different. Paul Volkcker had low rates until 1980 or 1981. The Fed was way behind the curve for most of the 1970's.
that date might live in infamy of derryb's posts. they won't move unless there are more than 1 print at 2
Just think how high the price would be if there was no Bitcoin.
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
How high would it be? Bitcoin market cap is $1T, gold $16T. I’m not smart enough to do the math.
Nothing is as expensive as free money.