A crushing recession it may be.

Will the FED raise rates another .75 again in November? Will the FED be able to unload a couple trillion of their balance sheet?

Or will it cave to the pressure and pivot too soon?

The real question is what effects will 4 to 5 percent bonds and 8 percent cola increases have on the Federal budget?

Yeah I think we will see another 75 bp next week and maybe the same in December....but at least 50 bp in Dec.

I think the fed will play hardball this time........as long as they can.

You can bet Yellen will be doing exactly that, about debt service costs while accepting no responsibility for her role in this.

I don't think they will pivot too soon UNLESS the credit markets freeze up. Remote, but possible.

It's going to get interesting?

Will we see deflation?

I don't think so. I sure hope not

Deflation is a function of a free market.

Free market ???? What's that ?

Lol, something that let's deflation happen and weak companies to fail.

New rate has been announced.

6.48 percent for existing bonds maturing end of October..

6.88 for new bonds purchased Nov 1 - 4/30/23.

The discrepancy is a .40 fixed rate for bonds purchased after Nov 1. The fixed rate will remain throughout the bonds life.

Are they a good place to put your money Steve?

Not the housing market.

My money? I don't have any lol. I like guns, ammo and ice fishing.

Is it a good place? A man could do worse. and it's guaranteed. Personally I think that after today's FED announcement, regular t bonds will deserve a good hard look if an individual is looking for a safe place to park some money until the markets settle or looking for a place to hedge volatility.

I tried googling this, but didn't find an answer. What a T bond? According to google it's a treasury bond. But when you google treasury bonds, it just shows you I bonds and EE bonds. Y'all are talking like T bonds are something other than I bonds. I'm confused, as usual, lol.

Angela, search Treasury marketable securities

I bonds if you can sit on your money for five years looks possibly being better to keep up with inflation I’m in over my head here though But with a 100 percent chance of a recession not a bad time to do some research.

Paul your young, stock market for you.

Ha ha, you must be delirious from wading in the rat sloughs . Next year could be a tough one for stock market.

From Barron's this morning;


You Should Have Waited. The New I Bond Rate Is More Attractive.


Sometimes it pays to procrastinate.

Individual investors rushed to purchase series I Treasury inflation-linked savings bonds last week, before a Friday deadline to get a 9.6% interest rate for the first six months.

There were record daily purchases of about $1 billion of I Bonds Friday and $7 billion for October. Investors were so eager to get the juicy rate that the TreasuryDirect website struggled under the traffic last week. Many people couldn’t access it.

Yet the new rate structure for I Bonds actually is more attractive, even though the rate of 6.89% for the first six months, announced earlier Tuesday by the Treasury, is lower, Barron’s estimates.

Why? Investors now will get a fixed rate of 0.4% annually in addition to an inflation adjustment, which gave people who bought the debt from May through October their 9.6% yield. Those buyers will get a fixed rate of zero for the life of the savings bond, plus the inflation adjustment, which is reset every six months based on the consumer price index.

The benefit of the 0.4% fixed rate will play out over time because I Bonds have a maturity of 30 years. After about four years, current buyers should be ahead of those who bought bonds last week.

The new rate of 6.89% reflects the inflation component of 6.49% based on inflation from March to September plus the fixed rate of 0.4%.

Many investors don’t realize there are two parts to the I Bond rate: the fixed rate plus the inflation adjustment. As the Treasury states on the TreasuryDirect website: “You know the fixed rate of interest that you will get for your bond when you buy the bond. The fixed rate never changes.”

The Treasury announces a new I Bond rate every six months, including the fixed rate that applies for the life of the bonds. That rate applies to bonds sold over the ensuing six-month period.

The fixed rate of 0.4% likely was set because of this year’s sharp increase in real, or inflation-adjusted, rates on Treasury inflation-protected securities, or TIPS. The real yield on TIPS 912828B253 +1.17% , which are bonds sold periodically by the Treasury with five-, 10-, and 30-year maturities, is up to about 1.5% from negative 1% at the start of 2022.

That means the fixed rate on I bonds is below the 1.5% real rate on TIPs.

Still, I Bonds have one key advantage. Taxes on I Bond interest can be deferred until the bonds are redeemed, or until they mature in 30 years. This isn’t the case with TIPS.

Interest on I Bonds, TIPs, and other Treasury obligations is exempt from state and local taxes, but subject to federal income taxes.

The main drawback with I Bonds is that individuals can buy only $10,000 per calendar year, although they can get an additional $5,000 in paper bonds using the proceeds of tax refunds. I Bonds are generally available only virtually, via the TreasuryDirect website. Certain partnership structures allow for the purchase of another $10,000 a year.

Investors must hold I Bonds them for a year and lose a quarter’s interest if the debt is redeemed within five years. Interest on I Bonds accrues and is added to the value of the bonds rather than paid in cash, so that it compounds over time.

https://www.barrons.com/articles/i-bond-bette-rate-november-51667329685?mod=hp_DAY_8

Barron's should watch the original video. A person can buy a lot more than 10k a year.

Ken M2 money supply is starting to fall. Deflation on the horizon? Will the FED pivot in December or is Powell determined to end the FED put?

I don't think the Fed will pivot any time soon. Especially after Powell's smack down yesterday We may see only 50bp in December but I wouldn't be at all surprised to see another 75bp.

I think Powell knows they made a huge .YUGE....mistake and are determined to correct it.........without making another one.


I don't think we will see an actual pivot in the next 12 months. Maybe a slowing of rate increases but not a turn around.

The fed doesn't really care about the stock market. Their singular focus is the credit markets and there are rumblings about a lack of liquidity there. That is something that could get super serious if it materializes. Recall what we saw with the Bank of England buying Gilts a couple weeks ago.

I still view deflation as a remote possibility. We are still experiencing negative real rates so I think there is quite a bit to go on the upside for interest rates. That will just continue to strengthen the dollar.

I'm hoping Powell sticks to his guns. It will be painful but necessary to try to bring back the free market so to speak.