we're getting rugged today

dear mr j pal

i don't want any more of this hit me

baby one more time crap

i want

hit me with your best shot

that is give it to us already today's

the day folks today is fomc day markets

still have consensus pricing in from fed

economists and watchers of a 50 basis

point hike which is ridiculous because

over 80 percent of the market is

actually pricing in a 75 basis point

hike jp morgan gave us actually very

interesting scenarios today in terms of

what could happen based on the rate

hikes and so we're going to go through

those right now first they suggest that

if we get a 50 basis point hike the

stock market might actually fall

this was actually somewhat

the opposite of what in the past we've

expected because we've always wanted

smaller is better just keep it to a soft

but we have been so reamed in this

market now we're just sick and tired of

small we want the big one give it to us

so we can finally feel something again

right so that's actually very

interesting that now potentially a 50 bp

hike could be negative because we

finally want the fed to grow some balls

and do it the right way

hike appropriately give us at least 75.

some folks calling for a hundred one

person at least interviewed by uh

bloomberg suggested that the fed should

just literally go straight to three

percent some suggest that that would be

kind of like getting paul volcker but

let's be real getting paul volcker is

setting interest rates at the fed higher

than the rate of inflation so getting

paul volcker would be like all right

good luck everybody

we're going to 10

that would probably throw us into a

depression but anyway this this whole

like 25 50 bp nonsense is bad and so

it's no surprise that jpm says if we get

a 50

the market would probably go down

because we would think that inflation

will keep going this problem will keep

getting worse not better

next jp morgan believes that if we get a

75 bp hike the market will actually

really

in fact take a look at this bloomberg

chart here that suggests that after fomc

meetings markets tend to rally which is

actually what happened in march

we had a substantial two to three week

rally which was pretty cool let's see if

the fed wakes up and does some good work

today and we can actually get a rally

yeah because we want a rally that way we

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anyway

so what about if we get a larger hike

larger than 75 bp well jp morgan tells

us

that would probably be bad if we ended

up getting something like a 100 basis

point hike the market would not actually

see that as being priced in and

potentially we would have to price that

in however on monday and this is the

counter argument to that logic on monday

we basically priced in a four percent

terminal rate this is very important

because the previous terminal rate that

we had been pricing in the fed was right

around two point seven five to three

percent on monday when the nasdaq fell

almost five percent and you know it

effectively came down to what negative

33 for the year it was believed that we

had now priced in a substantially higher

terminal rate and so who cares if we get

a 100 basis point hike or one percent

hike who cares we've already priced in

that terminal rate but then we would

have higher rates for another extra six

weeks longer and maybe there would be a

little bit of short-term red jpm

believes though that that would fade

because the market would realize

ah

we kind of need it so look my goal is to

go live for the fed meeting because i

want to go through that scp summary of

economic projections and what do we

expect to find in that well we expect

the fed to actually finally be real with

us tell us that we're on the teetering

totter of a recession with gdp forecasts

for the end of the year probably close

to zero percent what are the ranges for

gdp forecast is anyone negative on gdp

forecast what about unemployment how

much of an uptick do they think we're

gonna get and when's inflation actually

going to go down and if they don't

actually give us real numbers that are

believable we're going to think they're

lying and when the fed loses confidence

that's when they end up having to pull

vulcarus so we don't want the fed to

lose you know even more

face we want them to actually grow up

here and give us their best shot