Fed: Can be "patient" in raising interest rates in 2016

[Value Buy]

They just announced In the Fed's final statement of the year, no need to raise the Fed rate in the immediate future.

If reading "between the lines", they were saying no rate increases til summer, at the earliest, and a slight possibility no rate increase in 2015.

[Value Buy]

does anyone but me think Janet Yellen looks like a funeral undertaker?

Think about the symbolism of the statement

[Value Buy]

She already killed the WTI oil rally with the announcement and raised the dow 100+ points

[AgeOfEnlightenmentSCP]

The fed is propping up the market- we already know that. The question is: when does it end, and how far and how fast does the market decline once that inevitable event takes place?

One thing that concerns me is housing.

Price of housing- about twice the median income. Oh, I know it's not right now. But that's the actual price. Ordinary interest rates are historically- about 8%. Housing price v. median wage:

1950: $7354 / $3,319 =2.2
1960: $11,900 / $5,620 = 2.1
1970: $17,000 / $9,867 =1.7
1980: $47,200 / $21,023 = 2.2
1990: $79,100 / $35,353 = 2.2
2000: $119,600 / $50,732 = 2.3
2010: $170,500 / $50,221 = 3.3

I do recognize that there's something to be said for locking in a low interest rate mortgage right now and that paper losses notwithstanding, you pay roughly the same, and you end up with a house valued about the same whether you buy a $300K house at 4.5% or you buy a $150K house at 8%-- even if the market plummets 50%. So, interest rates (if they're long-term, and fixed) are definitely a consideration.

[Value Buy]

Dec 17, 2014 18:07:29 GMT -5 AgeOfEnlightenmentSCP said:

The fed is propping up the market- we already know that. The question is: when does it end, and how far and how fast does the market decline once that inevitable event takes place?

One thing that concerns me is housing.

Price of housing- about twice the median income. Oh, I know it's not right now. But that's the actual price. Ordinary interest rates are historically- about 8%. Housing price v. median wage:

1950: $7354 / $3,319 =2.2
1960: $11,900 / $5,620 = 2.1
1970: $17,000 / $9,867 =1.7
1980: $47,200 / $21,023 = 2.2
1990: $79,100 / $35,353 = 2.2
2000: $119,600 / $50,732 = 2.3
2010: $170,500 / $50,221 = 3.3

I do recognize that there's something to be said for locking in a low interest rate mortgage right now and that paper losses notwithstanding, you pay roughly the same, and you end up with a house valued about the same whether you buy a $300K house at 4.5% or you buy a $150K house at 8%-- even if the market plummets 50%. So, interest rates (if they're long-term, and fixed) are definitely a consideration.

It's as if the President wants the Dow at 20,000 and has told the Fed do what you have to, to make it happen