Joe Kernen, Ian Deans, Wednesday Afternoon discussed on Money Matters
I hate to say this way, but I'm going to say something that might seem a little extreme. But you know, low interest rates is like the drug of choice for Wall Street, right. It's it's the cocaine or whatever you want to call it, and you know we can joke about that. But I'm serious about that. But it is an addictive drug to Wall Streeters and to the price of stocks, which you know large. It can be not only but you know, attributed to this low interest rate environment. At one time we had the Fed actually raising rates a couple of years ago for those that might remember, you know, the market reacted very poorly. Right now. There are times in the markets will do just fine when rates are rising, but to answer the question here. I think this addiction to lower rates is at an all time high. The hint of raising rates obviously rattles the market sometimes now doesn't mean it's going to crash or it's going to have a major correction, but The market is really definitely hooked on the low interest rate environment and the Fed looking at that. Recognizes that but must balance that with any perceived inflation out there. And if there is going to be some massive 70 style hyperinflation, right, they've got to use their tools, one of which would be to raise interest rates to try to quell that, so it is. It's a delicate balance. So You know, the market didn't like it so much. It didn't go down that that much on a relative basis. But what I would say is Markets, looking at the verb e edge and the rhetoric of the Fed and looking ahead and yes, they do see some rate rises ahead and and they don't necessarily love that, although it's not Catastrophic yet today. Well, it was crazy to watch on Wednesday afternoon because the meeting minutes came out and they said, Well, we didn't make any changes, but we're looking at a couple of bumps by the end of 2023. And that shot things down and number one I was. I'm always surprised when the Fed gives guidance beyond you know, next Tuesday, they don't even usually tell you where they're going for lunch tomorrow, let alone what they anticipate happening in 2022 or 2023. And then after that started a freefall, Fed chairman Powell came out and kind of blocked it back and said, Listen, I didn't say we were going to raise rates right away. And the market started to come up again. What must it be like to have the power to move things that quickly? It's incredible. I mean, they're the market is listening to every word. And you know this Fed regime in the last few Have promised to try to be a bit more open and transparent, and it's the kind of gentler fed, you know. So yes, fed Chairman Powell, You know he speaks a little bit more openly than previous Fed chair people and and it makes an impact an immediate at that, like you said, it's real time. It's almost like a real time. You know, movie that you're watching. It's incredible. We've come along way since the days when we used to have to try to figure out what the Fed was going to do by the angle at which Greenspan was holding his briefcase as he walked to the meeting. That's right. That's right. That was fun, too. Right? Right. Oh, yeah, Joe Kernen and the guys had a lot of fun with it and CNBC. We're going to come back and discuss the economy with Dean's Ian Deans, A that CEO of Brookstone Capital Management. We'll talk about market panic and oil prices and all kinds of good stuff..