End of an era ? | GIC discussions | Discussion forum

oltunde said

"End of an 'Era' ?"

Historically speaking, it's more like a 'Hiccup'.

Let's hope it lasts a little bit longer.

Dean

An "era" umm.. the end of a good year or year and a half maybe at best.

Modern governments hate savers. The race will always be to the lowest possible interest rate to sustain minimal economic action. That allows them to issue debt and/or borrow cheaply to pay for their endless vote buying. Sorry, "spending"

Out of curiosity I looked at similar discussions in this forum from 2020. Here is a typical quote.

I do not see rates going higher in the next 5 years, at minimum. We will have sub-3.0% GIC rates for >= 5 years. As such, I've shifted my short-term bias to long-term in terms of GIC duration. sf-cool

Situation is volatile and different scenarios could play out. You can take it to the bank.

I suppose this is why we ladder because nobody knows for sure
When you have a strong opinion on something you can throw a little imbalances into your ladder to suit your own bias .

mordko said
Out of curiosity I looked at similar discussions in this forum from 2020. Here is a typical quote.

I do not see rates going higher in the next 5 years, at minimum. We will have sub-3.0% GIC rates for >= 5 years. As such, I've shifted my short-term bias to long-term in terms of GIC duration. sf-cool

Situation is volatile and different scenarios could play out. You can take it to the bank.  

only 2y years wait if lock in to a 5y in 2020, except renewal will prob at the same time rates bottoms, oops.

But if the person who wrote that actually put the money where his money is, still RESPECT

agit said

no one knows ... by now we should know who wrote the above quote

IMO Central bank policymakers won’t cut for the sake of cutting unless something breaks  

They’ll respond to data. Future data. Which we don’t have. Yes, right now the data is pointing to 5e economy cooling and everyone is predicting that the rates will fall. In 3 months time situation could change 180 degrees. Nobody really knows what will happen in 12 months. Lots of known and unknown uncertainties. CBs screwed up by being too dovish and not responding yo data once. They can’t afford the same mistake twice. And even if they do, it could end up in higher long term rates.

New York (CNN)
—
Treasury Secretary Janet Yellen highlighted in a speech on Wednesday cooling inflation and an economy continuing to defy recession predictions.

During an appearance in Boston, Yellen touted the fact that television prices are down by 28% from their peak, used cars and trucks are 11% cheaper and gasoline is down almost $2 a gallon since June 2022.

Yellen also pointed to data showing the typical middle-class American household has “more wealth, higher earnings and more purchasing power than before the pandemic.”

I needed a good laugh today. Thanks to people who told us "inflation is transitory," they never disappoint.

What are we laughing about? Yellen is not that particular dude who can’t count. She may have been a little selective with her benchmarking but wages have been growing faster than inflation and asset prices went up. She is factually correct.

^ A good example of faulty cause and effect.