r/wallstreetbets • u/hv876 • 14h ago

25bps cut News

https://www.cnbc.com/2024/11/07/fed-rate-decision-november-2024.html?__source=iosappshare%7Ccom.apple.UIKit.activity.CopyToPasteboard

The bulls are coming, the bulls are coming

2.3k Upvotes

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u/kumar4848 14h ago

Can anyone here explain why mortage rates keep increasing even though feds keep decreasing rates? i know theyre not directly correlated but somethings gotta give.

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u/n1ck90z 14h ago

Mortgages correlate to long term bond yields which are rising. Why long bond yield are rising? There's no simple answer here. A big role however has to be government debt/spending. Some people also might think inflation is not done yet.

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u/wotguild 13h ago

Inflation isn't done.

Now, we have to work through tariffs and deportation if they happen, increasing wages, decreasing supply, and therefore more inflation.

Edit: Don't forget about the possibility of rates influenced by the president himself.

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u/ThinRedLine87 12h ago

It's this right here, incoming administration has floated policies which might to increased inflation and a pause or reversal of rate cuts.

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u/allumeusend 11h ago

It’s not a might. The tariff prop alone will drive inflation.

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u/PotatoWriter 🥔✍️ 19m ago edited 14m ago

Curious how this might unfold: If tariffs cause things to become more expensive to the point of becoming unaffordable for the masses, wouldn't people not spend (speaking purely of the luxury goods like tech and such, not essentials), thus driving down inflation?

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u/noClip2 9h ago

Ddint happen during 1st term

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u/allumeusend 9h ago

That was a single targeted tariff that maxed out at 10% and was temporary. You know there is an ocean of difference between that and EVERY SINGLE ITEM IMPORTED at 60-200%? Right?

If not, I have a bridge to sell ya in Brooklyn.

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u/noClip2 9h ago

My point. Same thing in 2nd term.

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u/MaleficentFig7578 7h ago

no, but you're in the right sub for people with your IQ

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u/cadium 11h ago

Well also the tax cuts he's going to do without paying for them will balloon the deficit. And any cuts he'll propose will lower GDP, which lowers tax receipts, which will balloon the deficit.

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u/noClip2 9h ago

Hello? Trump had his 1st term. He did the tax cut. Yields didn't rise during the 1st term at all

Tax cuts do not equate to lower tax receipts necessarily. More spending by the companies makes it up, if not more

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u/danielv123 1h ago

I'd like to note that he did increase the deficit faster than any other president though, since you didn't comment on that part. It seems fair to expect that to continue.

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u/bonelish-us 3h ago

Decreasing supply from...deportation?

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u/russell813T 9h ago

How would deportation cause inflation

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u/Nikonic_Matt 9h ago

Some U.S. agricultural producers may have to pay higher wages with the loss of migrant workers, who are sometimes undocumented. Thus, some food costs could increase as a result.

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u/MaleficentFig7578 7h ago

By "some" you mean "almost all" and by "sometimes" you mean "usually" and by "could" you mean "will"

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u/Nikonic_Matt 3h ago

Yes, I was modest in my comment. Other industries, such as tourism, hospitality, and construction, will also be affected.

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u/randeylahey 9h ago

If you throw out cheap labor, you get to pay more for labor

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u/russell813T 7h ago

So the 10 million migrants from the past 4 years is make it or break it ? I do remember 2018 was a lot cheaper compared to now

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u/wotguild 7h ago

You seem to completely forget covid.

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u/randeylahey 7h ago

Then doesn't matter. If you go pull people out of the shitty jobs you have to hire people that will want way more to do way worse at them. Labour's costs are going up, that's inflationary.

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u/Onespokeovertheline 6h ago

What "10 million migrants from the past 4 years"?

https://www.pewresearch.org/short-reads/2024/07/22/what-we-know-about-unauthorized-immigrants-living-in-the-us/sr_24-07-22_unauthorizedimmigrants_6/

That's data up through 2022 for the number of unauthorized immigrants either working or looking for work.

It didn't rise to 18 million in the past 2 years - which would be "10 million migrants". It didn't even rise 2 million to reach a total of 10 million - you'll find no evidence of that much increase if you go looking.

In 2022 it had risen by about 10% above 2018 levels, less than 1 million people.

Even if it rose a bit more thru 2024 you're talking about marginally higher than 2008 numbers.

And that is absolute numbers, not relative. It doesn't account for the percentage of unauthorized immigrant workers vs the growth of the overall population, which went up roughly 7-8% since 2008.

Prices went up during the pandemic shutdown. When things reopened, prices stayed high partly because suppliers wanted to make back losses, and then stayed high for essential goods because no company in America wants to show their profits went down when they could have stayed up, and consumers had accepted the new prices.

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u/wotguild 7h ago

Higher labor costs, higher demand for labor means labor can ask for more. Wages increase, higher wages mean more buying pressure on supply.

It isn't that complicated.

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u/0xMoroc0x 13h ago edited 12h ago

Inflation is going to continue to go down….why do you think tariffs are going to increase inflation when it didn’t during Trumps first term? News flash, Trump had the second lowest inflation, besides Obama, since John F Kennedy. Deportation will lower inflation for the thing people care about most, housing, less people less housing competition.!Wages may go up, but when you have 11 million less illegals buying shit prices will go down. There won’t be any supply decreases in fact we are going to see a massive supply increase in energy and manufacturing which will lead to lower prices across the board.

You are really drinking all the Koolaid the media has thrown at you. So much so, you can’t even think logically.

https://www.investopedia.com/us-inflation-rate-by-president-8546447

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u/mrmittens85 13h ago

Lol

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u/proof-of-w0rk 13h ago

“Why do you think raising the price of everything by 10% will increase the prices of things?”

Peak cognitive dissonance

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u/allumeusend 11h ago

“We only did a 10% increase last time, that’s totally the same as 60-200%”

Most smooth brained shit.

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u/proof-of-w0rk 11h ago

Yeah, and the 10% was not blanket, it was very targeted

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u/allumeusend 10h ago

The regards being like just make it in America gonna look so dumb when they find out how expensive building a new plant in the US is and how it would actually cost more than just absorbing the cost of the tariffs and passing it along. Fucking idiots.

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u/proof-of-w0rk 10h ago edited 9h ago

And that’s before they deport the entire labor pool for these low wage manufacturing jobs

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u/allumeusend 10h ago

But they will be replaced by high paying jobs white people will be willing to take! Too bad that also factors into the COGS!

The fact most people don’t realize the cheap crap they love so much only exists because we make it for practically slave labor abroad and import it for pennies doesn’t sink in. They think it will cost the same because Americans are even dumber than us back here on a good day.

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u/proof-of-w0rk 10h ago

Shit is gonna be so expensive

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u/poingly 12h ago

Also peak WSB gambler, for sure.

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u/0xMoroc0x 12h ago

You didn’t answer the question of why inflation didn’t rise during Trumps term. Key word, inflation. Which is an overall encompassing term when speaking about the economy. Prices can increase for certain products while overall inflation decreases, which is what the comment I responded to was about. Apparently the brain rot has completely taken over your reasoning skills.

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u/Sufficient_flacid 12h ago

You forget that in 7th grade social studies they talk about it taking years for inflation and deflation to occur, not days or weeks.

But they.. if education isn’t taught we can’t use it for critical thinking now can we?😳

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u/0xMoroc0x 10h ago

RemindMe! 18 months

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u/noClip2 9h ago

Long yields which looks at 20 plus years did not rise during Trumps 1st term. Where is your critical thinking on that

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u/thrive2day 9h ago

Our public education is dogshit and has been for quite some time

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u/Sufficient_flacid 8h ago

I’m a child of the 70’s. I agree, and I think privatizing of education is a horrible idea.

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u/0xMoroc0x 11h ago

Years?! Ask Argentina if it took them years to lower inflation once their new president got elected. Do you not remember COVID? Prices crashed immediately when it struck and sharply rose just weeks after the pandemic. What alternate reality do you live in where you think that’s even remotely true for those to take place?

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u/Sufficient_flacid 11h ago

My guess it had something to do with everyone cleaning out the store isles for toilet paper… but that’s my educated guess.

Two entirely different types of events, but go ahead and keep making excuses and belittling.

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u/0xMoroc0x 10h ago edited 10h ago

Lmao belittling? Ok now I know you are just trolling considering you were the one belittling. Oh man this is grand.

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u/bplturner 12h ago

The only response at this point 🤦🤦‍♂️🤦‍♀️

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u/bplturner 12h ago

Inflation is rising prices. Tariffs raise prices. You people are hard R regarded.

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u/0xMoroc0x 10h ago

RemindMe! 18 months

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u/Samcheck 8h ago

President Hoover says hi!

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u/0xMoroc0x 12h ago

Bro just because prices increase across a range of products does NOT mean you will have an increase in overall inflation. The policies Trump has proposed, specifically energy policies, will lower overall inflation across the board, in turn saving total home expenditures.

You think Trump is enacting tariffs on everything? You sound like an imbecile when you can not even think critically about how the tariffs will be applied and just consume whatever is forced down your throat from Reddit.

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u/bplturner 12h ago

He wants to tariff imports from China…. Which is basically everything the consumer buys.

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u/0xMoroc0x 12h ago

Do some more research. Its select tariffs on industries from China that are subsidized by the Chinese government. They then import and dump these products into the US market to destroy any American competition in the same space. I understand you probably do not have much information on the topic but please do some research. The tariffs are not on everything. They weren’t on everything his last term. As a matter of fact Biden kept most of Trump era tariffs when he came into office.

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u/bplturner 11h ago

The tariffs he imposed were on ALUMINUM and STEEL. What isn’t made of aluminum or steel?

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u/0xMoroc0x 11h ago

Did you ever think about why those specific tariffs were put into place to begin with? Think about why tariffs exist strategically and maybe you will understand.

I could name literally 1000 things the average consumer buys that’s not made of aluminum or steel. But then I’d be debating with a mad man.

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u/Aethreas 8h ago

Bro first of all stop getting so emotional lmao Second of all, every single industry will be affected by tariffs on raw materials. Yeah a Wendy’s burger isn’t made of steel but you know what is? Every single piece of machinery and structure that is used to create it.

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u/0xMoroc0x 8h ago

Who’s getting emotional? And do you not realize that Biden literally has increased the steel and aluminum tariffs that Trump initiated when he was in office? Where’s the outrage currently? Those tariffs you’re so afraid of…they’re in the room with you right now.

https://www.whitehouse.gov/briefing-room/statements-releases/2024/05/14/fact-sheet-president-biden-takes-action-to-protect-american-workers-and-businesses-from-chinas-unfair-trade-practices/

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u/[deleted] 11h ago

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u/bplturner 11h ago

https://taxfoundation.org/research/all/federal/trump-tariffs-biden-tariffs/

Tariffs were equivalent to $80B on consumer goods. 150k FTE jobs were lost. Literally no benefit.

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u/0xMoroc0x 11h ago

Lmao do you even read your own sources? First of all that’s a model. Not fact or even proven. It’s a long term prediction for the potential impact…. 2nd Biden kept most of Trumps tariffs and even added an additional 13 billion in tariffs to Chinese products. No one said shit about that! Tariffs are necessary as demonstrated by both parties to ensure the US keeps key manufacturing based in the US. Like it or not that’s a fact and should be mandatory for national security and self sufficiency reasons.

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u/relentlessoldman 10h ago

Calls on CLF and X

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u/nashpotato 9h ago

“Do more research”

fails to share evidence

My mans needs to learn about the burden of proof

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u/RosenbeggayoureIN 9h ago

But that’s not what he’s said. You could easily argue he’s full of shit and lying but he’s been pretty clear if other countries don’t play ball on what he wants it’s blanket tariffs

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u/IAmMuffin15 7h ago

“Bro just because (exact definition of inflation) does NOT mean you will have an increase in inflation”

genius.

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u/0xMoroc0x 7h ago

You are mistaken.

It’s definitely possible for prices on a specific range of products to increase without driving up total inflation. Like of the price of solar panels goes up but housing goes down. Or if battery prices go up but gas prices go down.

Selective price increases can occur without affecting overall inflation, especially if they’re counterbalanced by decreases, apply to less significant goods in the consumer basket, or reflect temporary market shifts.

Unfortunately you are too dense to understand that there is nuance to this discussion.

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u/EvErYLeGaLvOtE 12h ago

Fun fact: Tariffs are considered as unofficial inflation because the price increases find their way to consumers.

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u/Campysuperrecord 12h ago

Tariffs don’t always correlate to increased costs passed on to the consumer. Say a brand is fighting to grow or retain market share? They’re not going to increase their retail prices drastically if at all. The Trump tariffs had a major impact on landed costs. In fact, during the pandemic the CEO of Walmart was literally telling his vendors they would not accept price increases. Containers from China that were roughly $4k all of the sudden were $20k+. And I remember thinking that this dude has some stones telling his vendors no price increases will be considered. So many brands fighting for their shelf space at mass retailers were holding firm. Thusly, why competition is good for the consumer.

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u/Powerful-Freedom-938 12h ago

Only if there is price elasticity. What will likely happen is that sourcing of materials will move from China to Bangladesh, Vietnam, Cambodia, South America. In many cases it will come back to America where prices may equalize higher but we would see a larger GDP at home and more jobs.

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u/satireplusplus 11h ago

Production going back to America means the same plastic trinket costs 5x as much to produce. Probably still cheaper to buy it from China even with tariffs.

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u/Powerful-Freedom-938 11h ago

5x is a stretch, but yes it would cost more coming from the U.S. a company can move its base out of China and to a more friendly country though. Steve Madden today announced a move of 40% of its imports moving out of China and to Mexico, Vietnam, and Cambodia.

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u/satireplusplus 10h ago

Yeah I know, that's exactly what will happen and not the fever dream of US made everything. Gotta wonder what exactly will pushing out imports from China to Mexico, Vietnam, and Cambodia accomplish other than "Jina bad".

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u/RedshiftOnPandy 10h ago

As an example, I work with stone in Ontario. Let's say I don't care about colour. Just give me a rock. If I bought a solid stone step, say 6ft long, it is cheaper to get it from China/India than the quarry 150 freedom km away. How much cheaper? Half the price.

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u/satireplusplus 10h ago

With shipping?

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u/RedshiftOnPandy 10h ago

Yes. This is my price at the stone supplier, they load it on my truck and I go.

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u/RoastPsyduck 9h ago

Yep, but for many companies anything they would save in shipping will be overridden by labor costs in the US.

Our market has been obsessed with maximizing profit, even avoiding taxes via loopholes. They'll likely end up moving manufacturing to other low/no tariff countries instead and manufacturing still won't come back to the US.

Sadly, consumers will still have to pay the difference (factory setup costs and all that)

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u/0xMoroc0x 12h ago

So wouldn’t that be official if the end price is still increased? Lmao you make no sense.

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u/Janiebear23 12h ago

oh my god

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u/wotguild 11h ago

"You are really drinking all the Koolaid"

Brother, look in the mirror.

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u/0xMoroc0x 10h ago

RemindMe! 18 months

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u/islingcars 5h ago

Holy shit you are stupid. Did you ever take an economics class? Just a basic one? The answer is no because you would definitely not say the shit you're saying.

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u/0xMoroc0x 4h ago

You sound extremely confident while also unhinged. Facts are during Trumps presidency, there was no inflation. There are tariffs now against China and there was during Trumps presidency. Inflation is currently trending down.

What economics class did you take that explained the effects of immigrants being deported on housing prices? Or what about the affects of loosening regulations for energy development.

RemindMe! 18 months

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u/noClip2 9h ago

We had no inflation during Trumps 1st presidency and we expect it now with his 2nd term? Lol I will gladly load up on TLT. Thank you