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Benzinga PreMarket Prep 8:00AM ET- 9:00AM ET BenzingaTV on YouTube
Benzinga PreMarket Prep 8:00AM ET- 9:00AM ET BenzingaTV on YouTube
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00:00 All right. We'll see what happens with Stellantis and that UAW, but I wanted to show here the
00:04 Fed tool, of course, and what is it showing us? 99% chance of no interest rate hikes at
00:13 this meeting. So I think we can pretty much put that on the back burner, right?
00:16 They're not going to.
00:17 I mean, if it's saying 99%, I don't think anyone in their right mind is thinking that
00:21 they raise interest rates at this meeting. Now, the question will be more of the actual
00:26 conversation, right? And how dovish and hawkish does that go? What are you guys expecting
00:33 to hear a little bit? I'll kick it to Joel. What do you think he's going to come to?
00:37 The same thing that he's been saying. The same thing is, I mean, people are just not
00:43 listening. He's been saying the same thing. Inflation, he is not convinced that they've
00:49 whopped inflation. He's not convinced he doesn't have to take rates higher of maybe another
00:54 quarter point, another half a point. He's been saying there's a lot of factors to consider.
00:59 He's data dependent. He keeps saying the same thing. People want to put words in his mouth.
01:05 So that is, I'll let you comment on that. But to me, it's just like.
01:09 No, I'm with you. He's been very consistent with the speech. I mean, you know, they've
01:14 been saying about, you know, if they get off, take off there, you know, they've got their
01:18 ear on the inflation. They're holding them down here. They got their, you know, he's
01:21 on there on the ground inflation. They're putting their foot on their throat, trying
01:25 to choke them out. And they've got to keep choking it out. And they feel like if they
01:28 scared if they take the foot off the inflation chokehold here, they've got on it right now.
01:33 That's going to start to come back in. Well, if you start lowering rates, you start all
01:37 of a sudden just coming in and start, you know, lowering rates prematurely. Absolutely.
01:42 It'll come back in. It came in before because of that. So I'm with them. I think you got
01:46 to have some short term pain for long term gain here. Get rid of the inflation entirely.
01:50 And you do that by keeping the rates elevated and it'll kill it. And that's what we're
01:54 starting to see is, you know, we are we are seeing inflation start to get in check. I
01:59 mean, so far, let's give them some credit. I mean, yes, they stayed, you know, obviously,
02:03 the monetary policy was too loose for too long. That was on Powell. But they've been
02:07 pretty good and consistent with their speech here. They're going to stay on the tightening
02:11 policy here for the foreseeable future. And that's going to continue to probably put pressure
02:17 on stocks to a certain extent. I don't see this imminent rally happening where, OK, we
02:21 beat inflation. Let's start lowering rates right away. They don't want to do that. They've
02:25 also seen the economy can handle higher rates. I wouldn't have believed that. I wouldn't
02:30 have believed that the economy could go from basically free money, you know, zero point
02:34 five percent or one percent, you know, I'm sure two percent or two and a half on your
02:38 mortgage to be able to handle five, six, seven percent rates. I would never have believed
02:42 the consumer could survive. They have they have found a way. So we have proven and the
02:47 power has proven that this economy can handle higher rates. Well, why go back to, you know,
02:53 we're just basically normalizing. I mean, over the course of time, rates were not at
02:57 zero. Still, we're still in a still low relative to the course of time. So we basically just
03:01 normalized rates. So maybe this is the new normal, folks. Maybe get used to paying a
03:05 little bit higher rates. This could be the new normal. And what about for your fixed
03:09 income? I mean, this isn't bad for everybody. This isn't bad for people that are on fixed
03:15 income and the people that have been, you know, I'm going to tell you to stay out of
03:18 the stock market for a long time. It's right. There's a lot of things that happen. I'm just,
03:23 you know, of course, you made absolutely nothing for decades. But there's some people now that
03:28 are just are a five percent. I mean, five, five and a half percent. I mean, it's you
03:33 know, I don't know if those people are going to be out by not getting new solar panels
03:38 or buying new cars and things like that. But, you know, it's historically I mean,
03:44 what was your first mortgage, Dennis? My first mortgage was double digits. I mean,
03:49 you know, five percent now. Well, the mortgage rates. Don't scare me, Joe. Don't scare me, man.
03:55 We can't afford that. It's not going to double digits. The U.S. government can't afford double
04:01 digits. We can't afford that. We're kind of to where we can go. I don't believe we can
04:05 continue to just go up 10, 12, 15 percent. It's not going to happen. We're already starting to
04:10 see teetering here at this level. We've hit the teetering level. So now hold it up here for a bit.
04:15 Let's see what transpires. Let's see what happens. Can the economy handle the rates up here?
04:20 They've got the opportunity. Economy says fall off cliff, they lower rates. So that's the one
04:25 thing, you know, that I say you can't be full bearish here either. Like, oh, we're going to
04:28 crash and burn and it's all over because the Fed has so many bullets in their chamber here now.
04:33 So I just think we're in for a period where stocks maybe, you know, don't continue to rise
04:40 like they've been rising here for the last six months. Just go sideways for a bit. A cooling
04:45 period. Let's call it a cooling period. I think the other thing, too, and then we're definitely
04:49 going to move on is, you know, I think rates would probably would have started going up in 20 or 21.
04:56 You know, I think that, you know, we had that little interruption in the global economy and
05:02 stuff. And so instead of the Fed perhaps looking at tightening, man, they were just handing out
05:08 checks and handing out money. And that, you know, that just kind of exacerbated the problem. So.