On Monday, I promised I’d tell you a little bit more about the Fed Funds rate. Well, the more I started writing about it, the angrier I got.
The Fed’s policy of raising interest rates is a sham. We may as well call the Fed Funds rate the Fake Funds rate. The policy is the opposite of monetary tightening, and actually is an easing. And the Fed Funds rate and all other published interest rates are based on a sham…costing you money every year if you are a US taxpayer.
Here’s how the scam works, and what you should do about it.
I see intermarket analysis (the idea that other markets can be predictors of the stock market) mostly as a big waste of time. Often, what correlates today won’t correlate a year from now, or the correlation may even reverse. The best way to analyze and forecast stock price trends is to analyze stock prices themselves. That’s the basis of technical analysis (TA). I spend about half my time on TA in my analytical work for The Wall Street Examiner Pro Trader Market Updates (http://wallstreetexaminer.com/category/professional-edition-3/todays-markets-professional-edition/).
But there is an exception to the rule that intermarket analysis is useless….and it’s the U.S. Treasury market.
If you know what to look for, Treasuries-in particular, the 4-week T-Bill-can tell you something very important about liquidity and which direction the money is flowing. That, in turn, will ultimately tell you where the stock market is headed.
Here’s how it works.