Wall Street Economists See Fed Rate at 2% or Higher (5% EOY 2005)

[papau]

http://quote.bloomberg.com/apps/news?pid=10000103&sid=aSJw1QjZJqj0&refer=news_index

Wall Street Economists See Fed Rate at 2% or Higher (Update1)
July 29 (Bloomberg) -- A growing number of Wall Street's biggest bond trading firms say the Federal Reserve by year-end will boost its target overnight lending rate between banks to at least 2 percent, the highest level since 2001. <snip>


Higher rates can lead to increased borrowing costs on everything from credit cards to mortgages. Already, the average fixed rate on a 30-year home loan is 5.98 percent, up from 5.38 percent in March, according to Freddie Mac. The difference is an extra $26,900 in interest costs over the life of the loan. <snip>

Thomas Hoenig, president of the Fed's Kansas City branch, said in a Monday speech to business leaders in Denver that most economists estimate the neutral rate, one that neither stimulates nor restrains economic growth, is between 3 percent and 4.5 percent. Hoenig votes on monetary policy this year. <snip>


A Labor Department report July 16 showed consumer prices rose 3.3 percent in June from a year earlier, the biggest 12- month increase since May 2001. For the month, they rose 0.3 percent, compared with 0.6 percent in May. <snip>

Forecasts for year-end 2005 range from 2 percent at Dresdner Kleinwort Wasserstein Securities LLC to between 4.5 percent and 5 percent at BNP Paribas. <snip>

[Media_Lies_Daily]

1. Well, THAT should accelerate bankruptcies and foreclosures....

...activities that appear to already be setting a new record every month.

[Fovea]

2. The economy is treading water over job loss

and now they decide to hand America a great big anchor.

[whistle]

3. Well, until the average American worker realizes that....

...minimum wages must be abolished, social security must be privatized, health insurance and for that matter health care is only for the wealthiest in society, frivolous lawsuits must be abolished and all social welfare programs should be turned over to faith-based groups so that they may bring the word of God to all of those who have fallen from grace and as such have brought all of this misery, poverty and social misconduct upon themselves, the reThuglicans will just keep tightening the monetary belt around everyones neck. Except of course for the very wealthy who will enjoy unlimited tax breaks and deductions as long as republicans remain in power and by pissing on the rest of us, they shower us with the benefits of their continued prosperity. That is "trickle-down" in its full manifestation.:freak:

[Fovea]

4. Or someone goes Falluja on their asses

and starts picking them off as the leave their gated communities.