The calculation of what "breaks" is simple.
If Fed goes 25 bps, the validity in forward guidance via futures market goes down substantially.
If Fed goes 50 bps, the validity of the mainstream mouthpieces and economists (Timiraos etc) goes down substantially.
If Fed goes
Jim Bianco
@biancoresearch
09-18
2/4
Markets, such as the Fed Funds futures, are pricing a 66% odds of a 50 basis point cut tomorrow (negative = cut, positive = hike).
Typically, the day before the meeting, these odds are either 95%-100% or 0%-5%.
So, this level of uncertainty alone is unprecedented.
wait
have they ever increased/decreased not in 25bp intervals???
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Disclaimer: The content above is only the author's opinion which does not represent any position of Followin, and is not intended as, and shall not be understood or construed as, investment advice from Followin.
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