Will The FED Accelerate Rate Hikes Into The Yield Curve Inversion And Subsequent Recession?

The FED is terrified. 

Considering recent stock market performance it is now becoming apparent what they have done. With global debt now at $233 Trillion and with the stock market in a runaway bubble, it is only a matter of time before everything blows sky high.

Consider the following……

The Fed says it could speed up rate hikes because of Trump’s tax cuts

  • The Federal Reserve debated the impact of tax reform on the economy and on how it sets interest rates, minutes of the December meeting showed. 
  • Most Fed officials favor gradual rate increases. However, some noted that the economy could be about to get a boost from tax cuts, which would necessitate faster rate hikes.
  • The Fed expects to raise rates three times in 2018. 

I would suggest their desire to increase rates faster has nothing to do with Trump’s tax cut boost and everything to do with the Shiller’s Adjusted S&P P/E Ratio being at a record high of 33. That’s 3-5 full points higher than both 1929 and 2007 record readings.

Will the FED be able to successfully slow down this runaway train without triggering some sort of a recession?

Sure, just as they did at 2000 and 2007 peaks. 

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