Sunday, October 4, 2009

08/25/09 newsletter now in public archive

a few days ago I happened upon the following post at Mish's blog, dated September 22, 2009:

at the beginning of the post, Mish quotes Calculated Risk:

Unless inflation picks up significantly (unlikely in the near term with so much slack in the system), it is unlikely that the Fed will increase the Fed's Fund rate until sometime after the unemployment rate peaks.

Following the peak unemployment rate in 2003 of 6.3%, the Fed waited a year to raise rates. The unemployment rate had fallen to 5.6% in June 2004 before the Fed raised rates.

Although there are other considerations, since the unemployment rate will probably continue to increase into 2010, I don't expect the Fed to raise rates until late in 2010 at the earliest - and more likely sometime in 2011.

after reading that and Mish's expansion, I thought to myself, 'hey that sounds familiar. . .'

then it occurred to me that I myself had written something very similar in a newsletter published August 25, 2009. me:

I watched a bunch of Bloomberg TV clips on youtube yesterday and the world is a buzz about what the Company Store's „exit-strategy‟ is going to be. Don't worry about it. Official interest rates will not be increased anytime soon, if ever.

Even if we are on the road to Recovery, which appears doubtful to this analyst, it is still unlikely that the Unemployment Rate has topped out. Coming out of the last recession they did not raise the Fed Funds Rate until a full year after Unemployment peaked. And remember, that was a „mild‟ recession.
The subject of the newsletter that day was Interest Rates & Bonds. I have made a copy of the original PDF file of the report available to the public at the Old Reports page. you can also view it directly by clicking on the following link:

I make a point of reading both Mish and Calculated Risk on occasion (though as a whole I read very little -- reading messes with my head), and I definitely recommend adding them to your regular reading list, in the off-chance you haven't already done so.

but for as little as $1 an issue you can also read my latest musings and market analysis in the Trend & Value Letter. this obscure little publication can help keep you ahead of the curve.