Category: Yelllen

30-year Mortgage Rates Hit All-time Low As M2 Money Velocity Crashes To 1.097 (Powell’s Plunder Helps Stocks)

Yikes! According to the Federal Reserve of St Louis FRED, the velocity of M2 Money Stock (Nominal GDP / M2 Money Stock) just crashed to 1.097, the lowest in modern history.

As of today, Bankrate’s 30-year mortgage rate just hit an all-time low (thanks to The Fed’s massive reaction to Covid-19 virus economic shutdown. Note: Bloomberg has not updated its M2 Money Velocity chart which is now 1.097.

But stocks are soaring with The Fed’s QE.

Limbo Rock! Fed Funds Futures Imply Negative Futures US Interest Rates

Fed’s Jerome Powell is watching how low interest rates will go.

Despite Chairman Powell’s claims that the US will never go negative, The Fed Funds Futures rates are signaling YES.

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Negative interests rates are appearing in US Treasury Strips (both coupon and principal strips).

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The short-end of the Treasury curve is flirting with negative yields while the TIPs curve is profoundly negative beyond 3 years.

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How low will interest rates go?

jaylimbo