Looks like the DOW will open up over a hundred points this morning. Of course wall street is

[still_one]

thrilled about the deregulation that is coming down the road.

A speech which gave no specifics, but vague generalities, has pumped them up

Those who actually have a mind are aware of the bigots that are part of this administration, and realize the appointments to the agencies he wants to destroy will eventually come back and destroy us unless they can be stopped

[uponit7771]

1. Buffet said what I've been saying for months; the 10 yr is still low so it pressurizes stocks and

... the second the 10 yr rate goes up the stock market will crash.

Anyone who doesn't think we're in bubble territory is beyond crazy

[Sherman A1]

3. For those of us not knowledgeable in all things financial

this is a rate set by the Federal Reserve or is it something else to which you refer? Sometimes the terms escape me and I want to keep my eye on those things that are important.

[uponit7771]

7. Reserve, that's why Benedict Donald's fed Chief was important cause he's not going to be independent

... of Benedict Donald's economy and will most likely keep rates low into inflation.

[unblock]

9. the fed usually only "sets" the fed funds rate, which is for an overnight rate for banks.

longer-term rates, from 1-month to 30-years, are set by the markets.

knowing fed policy on the short end is certainly a factor in influencing yields on the long end, but other things like future growth and inflation expectations are more relevant as well.

if the market believes the economy is going to boom, they'll figure we'll either have inflation or the fed will have to raise short term rates in the future, which drives the 10-year up.


*strictly speaking, even the fed funds rate is determined by the market, but the fed is an 800 pound gorilla that buys and sells in order to keep the fed funds rate in the desired range. it's a losing battle to fight the fed, so the market helps keep rates in the range the fed wants.

*the fed can mess around with other markets as well, e.g., they bought up 30-year mortgages during the financial crisis, but this is a rare action. usually they just stick to the fed funds market.

*there's another interest rate called the discount rate that the fed sets. it's not a market rate but a rate at which banks can borrow directly from the fed. it's also rarely used these days, though it was used during the financial crisis.

[still_one]

4. Interest rates have been creeping up, though slowly. Still I believe the impetus for this rally is

the deregulation they believe is in the cards.

[Yavin4]

10. Specifically, financial deregulation

Allowing the banks to gamble again through derivatives.

[still_one]

12. Absolutely. The repeal of Dodd/Frank, and speculation that social security will be privatized or

a variation thereof

[Yavin4]

13. Privatizing Social Security means....

handing over the public's meager, paltry, old age insurance to a small group of people who went to work on Wall Street so that they can make enough money so that the hot girls that rejected them in high school will finally fuck them.

[Hoyt]

6. Surprisingly, that is really not what Buffet said.

http://money.cnn.com/2017/02/27/investing/warren-buffett-bubble-stocks-trump-rally/

[uponit7771]

8. Yeah... pretty much ... I added the crashing part because of his whole statement, I watched the

... interveiw

But the key, according to Buffett, is that the 10-year Treasury yield is sitting at just 2.33%. That's not only low historically, it's actually down considerably from nearly 2.6% in mid-December.

Take away the low 10 yr T and there's no need to stay in equities.

He said stocks are cheap because of the T... well, T goes up stocks aren't cheap

[Hoyt]

11. Like Buffett said, if interest rates were 7 or 8% the stock market would be overpriced.

Interest rates are nowhere close to that. Doesn't really matter to me, because I believe market will stumble when people realize Trump is full of BS.

[uponit7771]

17. Yes, that's correct... it will have to get to 7 - 8% 10 yr T before money comes out of equities

[Wounded Bear]

14. Yeah, I'm no market expert, of course...

but this recent rally has bubble written all over it to me. I don't see any real substance behind the high numbers.

[HoneyBadger]

2. The bigger they are, the harder they fall

There is still plenty of money on the sidelines. Once the stupid money goes in, then watch out. Happens every single time.

[still_one]

5. There is always money on the sidelines, and constant influx from 401Ks

[MoonRiver]

15. This is the one and only positive thing I've experienced since Idiot-In-Chief was installed.

I'm just trying to calculate when to get completely out of the Stock Market, cause I know the irrational exuberance bubble is going to burst. Right now, I'm riding the wave, but wipe-out is coming, guaranteed. Sorry for the mixed metaphors, lol.

[still_one]

16. If one has at least doubled their money, they could take half out of the market and protect their

principle investment

[MoonRiver]

19. Thanks.

[roamer65]

18. Sell into strength, folks.

Get it into money market funds.