SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : Mish's Global Economic Trend Analysis
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: russwinter who wrote (53017)7/4/2006 8:45:41 AM
From: studdog  Read Replies (3) of 116555
 
The "conundrum" that raising short rates led to falling or stable long rates was presented and discussed on this thread 2 years ago when some correctly predicted that when Greenspan began to tighten, then long rates would fall instead of rise, the latter being the conventional wisdom.
We are at a similar juncture and it seems to be much more likely that long rates will rise (not really what the Fed wants) as soon as they stop raising short rates, rather than the inverse.

This could lead to some paradoxes, that is, if the Fed stops raising short rates and long rates actually go up, then the dollar will appreciate, the economy will slow, inflation pressures ease, thereby producing a negative for gold. That is not the conventional wisdom.
Conversely, if the fed continues to tighten, then long rates could fall or at least not go up, producing the opposite scenario from what would normally be expected.
Any bets?

Karl
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News