Quote:
Originally Posted by DoubleK
I seriously doubt anyone on CP was investing when Volcker was Fed Chair.
We haven't seen this many rate increases of this size, consecutively.
If JPOW sticks to his guns, each 50 bps is going to hurt more and more.
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I was investing in the stock market 15 years before Volcker became the Fed Chairman in 1979.
I think the unprecedented changes to the interest rates should be viewed in relationship to the unprecedented challenges we are facing at this period of time. The various factors, FWIW as I see it, affecting the market, are outlined as follows:
1. Problem with the
supply chain and its effect on production. I understand it has been improving somewhat.
2. Domestic and worldwide
inflation initiated by the release from lockdown, and brought on largely by past government and personal overspending facilitated by chronic low interest rates. Some of the ongoing contributing factors include material and labor shortages, rising wages, falling and rising (US) currencies, etc.
3. Rising
interest rates. Are we going back to low rates of the last 10 years, heading for rates similar to the 1970s and 1980s, or somewhere in between? I think we should know the answer sometime in the coming year.
4. How well is our
healthcare going to handle disease outbreaks like covid and various viruses? The most important question is how are we going to pay for the required changes.
5. War in the
Ukraine and its effect on energy and food markets
6.
Climate Change and need to develop a practical, economic and reasonable plan to transition out of hydrocarbons as an energy source. The success of such a plan appears to depend on its effect on our energy requirements and food needs, and on the masses willing to sacrifice many of our present advantages.
7. Numerous problems in helping our
Indigenous people
8.
Technology...adapting to the positives and the negatives
9.
Overpopulation and Immigration
10. Potential war between US and China over
Taiwan
11.
Black Swans
12. Etc.