Interest Rate Hike Tomorrow?

Op did your friend give a clue to how much of a percentage Benhanky was considering?
Considering I get a lousy .01 percent at the bank, how much do you think?

Oh, yeah. Forgot about your connection. Lemme know, brother.

She said she'd call me ASAP to discuss; she's been in meetings in VA all day. I'll get back to you as soon as humanly possible. I can't think of why a huge rate hike would help balance the equation. This would be a shot JWB style right in the proverbial temple.

Nick®

"Significant rate hike" when the rate is 0% already?

Don't think so.


I wonder why the euro hasn't tanked against the dollar?

The FED still keeping that thing alive still?

Till derivatives do us part...


The Law of Compound interest has driven debt levels to totally unsustainable levels, the collapse isn't a matter of 'if,' only 'when.'


Come on, OP, blaming the banks & the governments for making bad loans caused this mess? Takes 2 to make a contract, and people flipping houses and others who thought real estate prices would never go down are all part of the larger equation.

Nevertheless, sooner or later the bull bond market is going to come home to roost, and falling bond prices will raise interest rates on market forces alone, irrespective of Ben's helicopter.

They certainly did their part, but they wouldn't have been able to do their part if Wall St wasn't begging to buy any liar loan they could find, and Washington wasn't ordering them to make every liar they could find a loan.

I run a mortgage brokerage (The housing bust was the banks' fault for creating those stupid-ass loans and the government's for forcing us all to make them, so back off with your shots at the little guys. That's not what this is about).

Anyway, I got a pretty panicked call from one of my investors, a large West Coast wholesale lender, about an hour ago imploring me to lock all of my loans immediately because they anticipate a "significant rate hike" tomorrow, and when I asked if it was tied to the recent Cyprus unpleasantness, my account manager said he thinks so, but nobody told him exactly why.

My question is: Bernanke has said, on many occasions, he has no plans to raise rates anytime soon, and as we have seen mentioned, ad nauseum, for at least a couple years, to raise rates right now would be shooting our economy in the head. Did Cyprus change the game? I just can't see the Fed raising rates right now. Could this mess rock the market so much that rates float up on their own?

I'm about as panicked as I can be, after 5 years of watching this stuff every day, which is not very panicked given all the false starts, about the possibilities of Cyprus kicking off the derivative bomb we've all been looking for, but I have a hard time seeing our domestic interest rates going up much anytime soon.

What do y'all think?

The only thing I could think of to set off a rise in interest rates would be some kind of domino reaction in derivatives disney land. Maybe related to interest rate derivatives?

If the banks figure they might lose on interest rate bets they made, I suppose it's possible they would raise rates. But honestly, I can't think of any other reason they would do that.

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The only thing I could think of to set off a rise in interest rates would be some kind of domino reaction in derivatives disney land. Maybe related to interest rate derivatives?

If the banks figure they might lose on interest rate bets they made, I suppose it's possible they would raise rates. But honestly, I can't think of any other reason they would do that.

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Agree. This may certainly be viewed as the trigger when we reflect back in several years. If we are able to reflect back, that is.

And then everyone will wonder how such a small country took down the global economy, for which capitalism and democracy will get the blame.

I take that back.

Perhaps, the geniuses at the marriner eccles building have finally reached the conclusion that the liquidation value of perpetual debt threshold has been reached. Thinking it is related to the prevailing interest rates at the present, they intend to raise interest rates to avoid catastrophe.

When in point of fact it was the serial halving of interest rates that occurred from it's decade high in late 2007 of around 5.8% down to current record lows of near 0%. All the debt issued in that time frame would have to be doubled for each time the interest rate was halved to arrive at the total liquidation value of perpetual debt over that time period.

In other words, its too damn late now.

[link to www.safehaven.com]

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You missed the main point, OP, a collapsing bond market will cause interest rates to rise. If you are a mortgage broker you certainly know the inverse relationship between prices & bond yields. As for what you chose to highlight, cry me a river, Wall Street didn't need to beg for loans when there were plenty of mortgage brokers out there making easy money off of liar loans.