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U.S. federal reserve

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How a Federal Reserve Interest Rate Hike Hands Over Billions to Big Banks

By , Associate Editor, Money Morning • @DavidGZeiler -

federal reserve interest rate hike

Big banks around the world are secretly rooting for another U.S. Federal Reserve interest rate hike this week.

That's because every Federal Reserve interest rate hike causes an immediate spike in their income. Last year the U.S. Federal Reserve paid out $6.9 billion to the Big Banks, including more than $100 million to Goldman Sachs Group Inc. (NYSE: GS) and more than $900 million to JPMorgan Chase & Co. (NYSE: JPM).

Here's how this insanity started - and why it's bound to get worse...

How the December Fed Rate Hike Will Fleece Taxpayers – Again

By , Associate Editor, Money Morning • @DavidGZeiler -

The December Fed rate hike of 0.25% means America is about to pay a steep price for the Federal Reserve's loose money policies. Here's what we're facing.

If the December Fed rate hike of 0.25% marks the beginning of a period of tightening, the U.S. taxpayer is about to get a very unwelcome surprise.

Now that the U.S. Federal Reserve is raising interest rates, it won't be so easy to hide the dire consequences of years of loose money policies - especially all the quantitative easing (QE).

Here's why the Fed's balance sheet is suddenly a very big problem for America...

Warning: A Fed Rate Hike Will Doom These "Zombie" Companies

By , Associate Editor, Money Morning • @DavidGZeiler -

Corporate Debt Bomb

When the Fed rate hike that nearly everyone expects finally happens, a lot of U.S. companies that have been surviving on cheap debt will get pushed into oblivion.

But a Fed interest rate hike will raise the cost of that borrowing putting these "zombie" companies at risk.

Here's what the first Fed rate hike since 2006 will do to these debt-dependent companies...

U.S. Markets Down Ahead of Janet Yellen Speech Tonight

By , Contributing Writer, Money Morning -

An interest rate hike could happen as early as next week. Here are five of the clearest justifications for a December rate hike...

U.S. markets opened sharply lower Thursday as many investors await the Janet Yellen speech tonight at 5:00 p.m. ET at the University of Massachusetts.

During the Janet Yellen speech, investors will be looking for any clues that the Federal Open Market Committee (FOMC) will raise interest rates this year for the first time in nearly a decade.

Here's what investors can expect tonight...

The Only Way Bond Yields Will "Go Up" Now

By , Global Credit Strategist, Money Morning • @MichaelELewitt -

bond yields

Last week, the Fed chose to not raise interest rates. That decision will continue to render traditional bond investments unattractive, holding them to extremely low yields.

Just looking at the returns being generated by the largest bond funds shows you'll go hungry depending on bonds for income and total returns.

There is one way bond yields will go up... but it's not good. Here's what you need to know.

Keith Fitz-Gerald: "Federal Reserve Policy Is Past Its Prime, Ignores Middle Class"

By , Associate Editor, Money Morning • @TaraKateClarke -

KFG

Money Morning Chief Investment Strategist Keith Fitz-Gerald talked U.S. Federal Reserve policy with "Varney & Co." host Stuart Varney on FOX Business Monday morning.

Watch the video to see what Fitz-Gerald, a 33-year global market expert, predicts will come out of the FOMC meeting on Wednesday and Thursday (Sept. 16-17) - and why he's so fed up with Fed policy...

Peter Schiff: "The Fed Won't Raise Rates, It's Part of the Bluff"

By , Associate Editor, Money Morning • @TaraKateClarke -

The Fed

An all-important U.S. Federal Reserve meeting on Sept. 16-17 will decide whether interest rates will be raised for the first time in nearly a decade.

But Peter Schiff, economist, best-selling author, and CEO of Euro Pacific Capital, doesn't think the Fed is actually even considering a rate hike, despite speculation.

In fact, he predicts the Fed may be forced into QE4. Here's why...

Low Eurozone Inflation Proves How Helpless Central Banks Are

By , Associate Editor, Money Morning • @DavidGZeiler -

eurozone

The European Central Bank (ECB) is loath to admit it, but it has no control over the Eurozone inflation rate.

According to official data released this morning (Monday), Eurozone inflation in August was unchanged at 0.2%.

That's far below the 2% inflation rate target sought by the ECB. And it shows just how ineffective the central bank's unprecedented monetary stimulus program has been.

Here's what the ECB will do next...

Peter Schiff on U.S. Dollar Crisis: "The Dollar Bubble Is Going to Burst"

By , Associate Editor, Money Morning • @TaraKateClarke -

Stock Market Crash

Peter Schiff, economist, best-selling author, and CEO of Euro Pacific Capital, believes a U.S. dollar crisis is underway.

"The dollar is very overvalued...and the dollar is a bubble," he told Newsmax Prime on Aug. 11. "This dollar bubble is going to burst."

Indeed, two weeks later and Schiff's prediction proved timely. The U.S. dollar index has suffered a fourth-straight loss, and U.S. markets have plummeted in the worst weekly sell-off in four years.

Many blame the surprise yuan devaluation. But Schiff believes investors should be worried about the United States, not China...

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