by BlazingJava
With so many people trying desperately holding on to any good news lately, remember don’t fight the fed and don’t fight the trend.
If jobs number is good the fed will take it as a sign there’s more room to increase rates. If GDP grows or stagnates they will take it as a sign for maneuver.
The Fed was clear they want to fight inflation and will bring pain to the market companies and households for it.
But don’t take my word for it take Jerome Powell word:
“While higher interest rates, slower growth and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses,” he said. “These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain.”
Even with four consecutive interest rate hikes, including two back-to-back 75-basis-point increases, Powell stressed that the Fed is not in a place to “stop or pause” — an unwelcome sign for investors who were predicting a rate cut next year.
So next time you see a rally based on jobs numbers or GDP or whatever remember the fed will take it as a sign to keep increasing rates.
Overall the economy is screaming pain but crazy and late investors just want to grab some short gains, and my advice is don’t fight the fed and don’t fight the trend