RE:RE:RE:Continued pressure on oil/gas priceIts funny that the market and its gurus had been expecting a ,25% increase in the lending rate then when they got it they pushed everything down anyway based on a they might not raise it at all because of a banking crisis so ut was a pseudo-surprise.
It looks like the markets have resumed their normal course today that is to say the direction they were heading in prior to the FED announcement.
It is folly to think that the FED is going to back off of its stated objective because it is causing financial pain. A recession means financial pain for most and that is its intended goal in order to reduce inflation. I personally did not think it would work as I considered the main driver of inflation high fuel and energy costs and didn't think raising rates would affect them. I was wrong or at least appear to have been wrong and high fuel and energy prices are coing down with rate increases. It could be the two do not correlate but I am sure the FED does not see it that way,
The only upside to this that the FED may not have thought of is that lower fuel and energy costs may lead to increased consumption and a stabilizing of prices in an area where O&G producers are still making a good buck, managing costs, paying down debt and rewarding shareholders. Win-wineventually maybe?
GLTY and all
cleareye wrote: Ebankbank, I think you're right in the short run.
For example, tomorrow the FED will issue a statement on the FED rate increase. It may be zero to acknowledge the "broken banks". I tend to think it will be 0.25% to show determination coupled with their own variety of compassion. Or, it may be 0.5% to show determination with a statement of their narrative of whatever caused the bank problems and that their excellent decisive action has corrected said problem and they can continue putting people out of work and driving them out of their homes that they foolishly bought based on low interest rates; the proper ship is moving all steam ahead.
But, the big questions are, related to your post:
How will gold react?
How will oil price react?
How will the Dow Jones move?
In the short term, the markets will move where ever the powerful want and then the chattering paid experts will tell us why.
By next Tuesday, I think we will see commodities and stocks turn toward a course based more on fundamentals and less on pushed narratives. In the end, I believe oil will be driven higher based on supply and demand.
It's a long road. I don't think anyone of us on this board knows the planned agenda of Wall St and Bay St for the next three business days.
For example, will 0.5% show confidence and a decrease in gold, an increase in oil and an increase in the Dow? Or, will 0.5% show clumsy foolish tone-deaf nonsense from the FED, plunging the markets into dispair, a decrease in all sectors and commodities.
It's not even interesting to watch. But, I will.
cleareye.
Ebankbank said: The markets are controlled by a very few people, the only thing we can do is jump on and off the ride and try make a few dollars along the way.