so, how many of you think the fed will raise short rates a lot more than what the market expects? or how many of you think the fed will be much more gradual?
my opinion is that the fed will be more gradual.
here is my reasoning. the fed does not like to be seen as political. they are very reluctant to pursue radical monetary adjustments leading into an election. so i think they will NOT raise rates a lot more than what the market expects.
if the fed pushes up rates too much, then people will think they are trying to hurt the party in power. this is probably why they have not done anything yet, (and why i think they are far behind the curve).
Great question bear..thanks!
My brain is so overly extended on a dozen other things that I have no idea enough to even make contribute much but others should.
From what I am looking at 2022 is going to be a Messed up year and trying to predict how it will end is a tough one, but I think that you should take the FED at it's word and if they say they are raising, then that is what I think. I think with all that goes on, they will try and be very honest about certain actions.
Data dependent.
I was going to leave my response at just those 2 words, but I'll add this:
If the inflation wanes due to supply chain relief then they will let up on the tightening more than markets currently are pricing in.
If the inflation fire is lit (genie out of the bottle) then I expect them to be hawkish.
So, place your bets not on the Fed, but on what you think is coming on the inflation front. I have no strong opinions.