John Pitera's Market Laboratory Message Board

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Strategies & Market Trends : John Pitera's Market Laboratory

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To: John Pitera who wrote (18158)	4/25/2016 7:53:38 AM
From: The Ox	2 Recommendations Recommended By Hawkmoon kathtoo Read Replies (2) of 33421

I still believe negative interest rates are a very temporary accommodation. Similar to all the QEs we had here in the US, where the only purpose (IMO) was to shore up and put a new (more solid) foundation under the banking industry (regardless of what the talking heads say), NIRP will not last long elsewhere. Especially within the near term future, as the US will likely raise rates again (relatively soon). Negative interest rates "are the stupidest idea I have ever experienced," the newspaper Finanz und Wirtschaft quoted Gundlach as saying on its website on Saturday. "The next major event (for financial markets) will be the moment when central banks in Japan and in Europe give up and cancel the experiment." It's interesting to me that he characterizes this as an experiment. I'd say it's more of a "painted themselves into a corner" move and won't last long at all. I find it hard to believe we are in a "one and done" scenario with FED rates. Whether or not Gundlach is simply talking his book is hard to gauge, although I suspect that's the case here. He's certainly been one of the more vocal "doom and gloomers" lately.

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