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.
Pastimes : The Philosophical Porch
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Rarebird who wrote (26176)6/19/2025 10:09:58 AM
From: Real Man  Read Replies (2) of 26251
 
The market is setting the rates, via the Fed. I think we disagree on Fed input in that process. There has to be an entity that is able to create money out of thin air to regulate money supply or else you get Great Depressions, not recessions. That entity smoothes business cycles and creates inflation. However, the actions of that entity (the Fed with the ability to write a blank check) is governed by the market.
The market puts Trump tariffs into economic models and spits out predictions based on economic forecasts based on these models. These predictions determine the future yields for the Fed funds rate. The treasury cannot create currency out of thin air, only the Fed can do that. The treasury has to borrow in the market.
I find it interesting that the swaps market rates US sovereign credit 1 notch over junk. Will there be more downgrades? Probably not. The US credit bureaus will never rate US sovereign debt fairly, that is to be expected.
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