Stock market waiting for the fed.

[Free bird]

S&P down .17%.

 

[marko]

Hoo boy.....

 

[audreyh1]

I think we are still a ways from 4% on the 10 year being “normal”. The last time we peeked above 4% and very briefly was mid 2008, and before that Dec 2007. That’s over 10 years ago.

Once we are steadily above 3% and inflation starts to creep a little higher then I might be reevaluating what “normal” might be. A bit above 3% itself might be a drag on the economy and might dampen the stock market enthusiasm a bit.

The Fed announcement won’t be until the 21st right? A few trading days to go.

 

[ripper1]

5¼% is "normal" since that's what it was for my passbook savings account when I was a kid.

As good an estimate as any...

+1.....Yeah, wow, that seems normal. Now if you find a 5 yr. CD yielding 3%.....

 

[SecondCor521]

What is considered a normal 10 year treasury yield? 4-5%?

I don't know. What I hear talked about more often recently is the neutral rate. I understand this term to mean the rates (and really all of monetary policy) where the Fed feels like they are in the sweet spot - full employment and inflation at their target of 2%, with equally balanced concern for undershooting and overshooting those twin policy goals.

The CNBC commentators and guests I've seen generally agree that the neutral rate exists in theory but seem to differ meaningfully on what that neutral rate actually is. Everyone I've heard, though, says it's higher than where we are today. (And by today I mean, uh, today.)

 

[DEC-1982]

Just a comment on the effects of rates that are already higher. I am beginning to see more defaults in my very small Prosper.com portfolio. It shows some strains for borrowers, either due to higher rates or perhaps they overindulged and took loans they thought they could afford but really could not afford.

I should mention this is an extremely tiny sliver of the overall loan market.