Prices.... Going Up!!!

[Mystic]

By autumn 2022, the price of money is gonna go up a lot.

Anyone else hear or read transcripts of yesterday's (i.e., 27 July 2022) meeting of the US Federal Reserve Bank's Federal Open Market Committee (FOMC)?

The lowdown:

The FOMC voted to increase all policy rates by 75 basis points, the second such increase in a row and the most aggressive increase in 28 years. No a single board, not even member Esther George, dissented from the committee's decision.

This manuever will increase the federal funds rate to between 2.25% and 2.50% -- still very low given that CPI inflation has spiked to 9.1% -- but significantly higher than the near 0% re: the February 2022 meeting.

During the post-meeting press conference, FRB chair Jerome Powell, unequivocally, stated that the board's top priority is reigning in inflation by "all necessary measures".

The changes include all of the following actions:

- Increase federal funds rate target range to 2.25% – 2.50%.
- increase interest paid on reserves to 2.4%.
- Increase interest charges on Overnight Repos to 2.5%.
- Increase interest charged on Overnight Reverse Repos (RRPs) to 2.3%.
- Increase primary credit rate FRB charges banks to 2.5%.

The United States Bond Market reacted immediately, with the yield on the U.S. Treasury 10-Year note remained below the 2.8% mark, a level not seen in two months.

Stay tuned for more exciting economic developments.

Riffing off yesterday's post re: FRB move to hike the cost of money: RECESSION IS OFFICIAL

The U.S. Gross Domestic Product index has now declined over two consecutive (financial) quarters, i.e., by -1.6% in Q1/2022 and by -0.9% in Q2/2022. See chart below, U.S. Quarterly GDP, FY 2018 through Q2 2022:



Detail of the presently active 2022 recessionary period:



So it's a recession. It's not large. Yet.

 

[45rpmspinner]

Riffing off yesterday's post re: FRB move to hike the cost of money: RECESSION IS OFFICIAL

The U.S. Gross Domestic Product index has now declined over two consecutive (financial) quarters, i.e., by -1.6% in Q1/2022 and by -0.9% in Q2/2022. See chart below, U.S. Quarterly GDP, FY 2018 through Q2 2022:

View attachment 2626263

Detail of the presently active 2022 recessionary period:

View attachment 2626265

So it's a recession. It's not large. Yet.

Not actually official as those numbers are usually adjusted up or down a couple of times as more data come in.

More than that, if this is a minor recession, it's unlike any we've seen before.
Unemployment rate is quite good.
The GDI [gross domestic income] figure, which theoretically should move with the GDP, is actually up.

 

[Falstaff]

An alternative to Cafe Bustello is Cafe La Llave that is made by the same company ( i believe ) and sells on Amazon or Target for a good price. My wife is Dominican and prefers the La Llave. 10oz brick of La Llave is about 3.40 a brick. Just an fyi.

 

[OBMG74]

My Money Market checking account interest rate last week "skyrocketed" from .08% to 1.14%.
Cmon' Honey, we're rich! Load up the kids, we're gonna go buy some gas that plummeted 20 cents per gallon...

 

[zebra03]

I remember the good old days . I had a Certificate of Deposit that earned 14.1% right out of High School.

 

[OBMG74]

I remember the good old days . I had a Certificate of Deposit that earned 14.1% right out of High School.

And you probably got to pick out an incentive gift of some sort.
I remember getting a garden hose.

We were encouraged by high interest rates to save, not to buy houses that we couldn't afford.

 

[usedto]

Had to pay $10 to park at my cousin's memorial service today.

 

[usedto]

I remember the good old days . I had a Certificate of Deposit that earned 14.1% right out of High School.

In 1978, I went to my credit union, borrowed $10,000 against my '70 Corvette at 9%, and put it in a Dean Witter money market account earning 14%.

 

[zebra03]

Brilliant !

 

[djwhy60]

What happened to "real" savings account returns?? I remember the days of at least 6-8%...now you are lucky to get .02%!! They loan out "our" money at 12 - 26 % but return .02%!!

 

[YY1]

Cafe Bustello on sale yesterday 2 for $6.

We bought 6.

I actually prefer Pilon, but my wife finds it a bit harsh.

 

[Jeffery]

Riffing off yesterday's post re: FRB move to hike the cost of money: RECESSION IS OFFICIAL

The U.S. Gross Domestic Product index has now declined over two consecutive (financial) quarters, i.e., by -1.6% in Q1/2022 and by -0.9% in Q2/2022. See chart below, U.S. Quarterly GDP, FY 2018 through Q2 2022:

View attachment 2626263

Detail of the presently active 2022 recessionary period:

View attachment 2626265

So it's a recession. It's not large. Yet.

2 consecutive negative quarters is no longer the definition of recession.

 

[Mystic]

2 consecutive negative quarters is no longer the definition of recession.

So the "new they" say, eh?

PS: Do I get to rename planet earth? The Milky Way galaxy? Huh?

 

[Mystic]

2 consecutive negative quarters is no longer the definition of recession.

It has been duly deemed a sentiment, rather than actual, recession.

Okay then.

 

[chazix]

So the "new they" say, eh?

PS: Do I get to rename planet earth? The Milky Way galaxy? Huh?

Did Lewis Carroll foresee the "Information Age", or is it just that this sort of thing has been going on since 1865 (or, probably, earlier)?

“When I use a word,” Humpty Dumpty said in rather a scornful tone, “it means what I choose it to mean – neither more nor less.”
“The question is,” said Alice, “whether you can make words mean different things.”

Sorry for the digression, but it seemed apt.

 

[Mystic]

Did Lewis Carroll foresee the "Information Age", or is it just that this sort of thing has been going on since 1865 (or, probably, earlier)?

“When I use a word,” Humpty Dumpty said in rather a scornful tone, “it means what I choose it to mean – neither more nor less.”
“The question is,” said Alice, “whether you can make words mean different things.”

Sorry for the digression, but it seemed apt.

That's exactly it. More or less.

 

[BillyTheKid]

Egg prices have been crazy, and we use a lot of them.
Last week I got them at Trader Joe for only 1.99
Yesterday Aldi had them for 3.25...2 years ago they were 44 cents.

What's a poor boy to do ?

 

[dinger]

What's a poor boy to do ?

Sing in a rock & roll band!

 

[OBMG74]

Egg prices have been crazy, and we use a lot of them.
Last week I got them at Trader Joe for only 1.99
Yesterday Aldi had them for 3.25...2 years ago they were 44 cents.

What's a poor boy to do ?

Raise chickens?

By the time you buy the chickens, build a pen, buy chicken feed and whatever other chicken accessories you need, you're probably at $3.50/dozen!

We have a neighbor who has them, they enjoy it

 

[spicer]

That's exactly it. More or less.

That's it, absolutely. Who is it that can speak words into things. Things come first.