Posted on 10/03/2023 9:58:06 AM PDT by lasereye
A Wall Street selloff intensified Tuesday as rising Treasury yields piled on pressure and investors got a reminder not to expect a Federal Reserve interest rate cut any time soon.
The S&P 500 (^GSPC) dropped almost 1.1%, while the Dow Jones Industrial Average (^DJI) tumbled about 1.1%, or more than 350 points. The tech-heavy Nasdaq Composite (^IXIC) was down over 1.5% after closing with a gain on Monday.
Hawkish comments by Fed policymakers reminded investors that resilience in the US economy likely means borrowing costs will stay higher for longer. Traders are now pricing in odds of 29% that policymakers will hike rates at their November meeting, compared with 16% a week ago, according to the CME's FedWatch tool.
That prospect helped 10-year (^TNX) and 30-year Treasury yields (^TYX) rise to 16-year highs on Tuesday — a selloff in bonds that, combined with surges in oil prices and the dollar, has dampened appetite for stocks. The Russell 2000 index of small caps turned negative for the year on Monday.
In other economic news, the number of open jobs in the US increased in August, raising questions of whether the job market is cooling fast enough to appease the Federal Reserve. The latest Job Opening and Labor Turnover Survey, or JOLTS report, released Tuesday revealed there were 9.6 million jobs open at the end of August, an increase from the 8.83 million job openings in July. Economists surveyed by Bloomberg had expected there were 8.82 million openings in July.
The JOLTS report comes ahead of the highly anticipated September US jobs report on Friday.
Stocks took another leg down after Cleveland Fed President Loretta Mester said Tuesday she is likely to favor a rate hike at the next meeting if the current economic situation holds.
(Excerpt) Read more at finance.yahoo.com ...
Fed.gov interest payments are about $1 Trillion per year.
Majority of debt is short-term, so when it rolls over, interest expensive alone will go to >$2 Trillion.
total Fed.gov tax collections in 2022 were near $4 trillion per year, but are declining now - presently in the range of about $3.6 Trillion.
This is what a debt-collapse looks like.
I got a part time job and start Thursday. It’ll help buy the groceries.
Problem with the government making up fake numbers like this is reality always wins in the end. They can massage the numbers, they cannot massage actual outcomes
It was always just a matter of time.
As a side observation, gold and silver have been thrashed over the past month or so. There’s been some small relief on oil, but not much.
Less than $700 Billion interest payments in the fiscal year just ended. It will go up rapidly as interest rates stay high, as you point out. Very soon it will bigger than defense spending. In less than 2 years.
Yes, there is no pain cream for pain ordinary Americans are feeling with inflation. Many are using credit cards to keep up.
Job openings magically appear, just in time for the illegal immigration surge
Hard to wait tables if you don't speaka da Englesh
More bank insolvencies coming soon. Do not remain calm, all is NOT well.
Economy pretty much looking like our football programs these days.
“This is what a debt-collapse looks like.”
...and just in time for the US Dollar to lose its status as the world’s reserve currency, all due to a handful of Neocons who demanded we use Ukraine to ‘weaken Russia’, and, at the same time, are doing all they can to DESTROY our economy (EV mandates, many, many other things), while at the same time WILL NOT permit anything to be done in the US to strengthen our economy.
My prediction: Assuming that the Democrats keep control of the election machinery, beginning in 2025, we’ll have massively higher income, social security, and medicare taxes. On top of that we’ll have a gasoline tax quickly rising to about $5/gallon, and a brand new VAT, starting at 15%, as they’ll need to increase revenue to at least $6T a year, just to come close to maintaining spending levels (and paying off interest).
Like it or not, the Baby Boomer Generation has wrung everything they could out of our country, and loaded us up with debt, thanks to their idiotic wars around the world, and, so, it will be time for us, in the later generations, to face the REALITY of what they’ve done to America.
Yep.
Interest rates affect stocks? Who knew?!!
“it will be time for us, in the later generations, to face the REALITY of what they’ve done to America.”
Cool. What will you youngsters do?
The economy either sucks or it doesn’t suck. Which is it?
I’m going with...sucks.
“The economy either sucks or it doesn’t suck. Which is it?”
The economy is currently expanding at a slow rate and unemployment is extremely low. Individual results vary widely. Some people are doing great, others OK, still others lousy. A rather healthy percentage does lousy no matter what the general conditions are.
“99% of failures come from people who make excuses.”
-George Washington
“Cool. What will you youngsters do?”
What else, leave the country before it’s Third World.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.