I'm a firm believer in conspiracies. I don't trust Wall street. The latest numbers aren't the real issue, but whatever the big players want (i.e. the institutions). So with that in mind here's my take about what will be happening. Save this post and remember who warned you:
The Fed, which is another armchair for the Institutions, will continue raising rates. The excuse will be this or that latest economic number. Even though the truth is that any of the numbers can be interpreted however one chooses. For example, friday the so-called jobs report showed an increase of over 330,000. However, many of those may be temporary. And at the same time the unemployment rate actually increased to 5.5%. Yet, the financial news media spin is clearly that the latest stat means higher rates are certain (they were certain before too, but now there is justification for more increases). The question is why? Why is the Fed so anxious to find any positive spin in a stat to justify much higher rates? The answer is nothing to do with some convoluted interpretation of budget deficits, oil prices, etc. It has to do with the fact that there are a lot of longs on stocks that would be hurt by interest rate hikes, like REITs and Bond funds. The big players that have positions want the little players to be shaken out of these stocks, and having interest rates hiked is the psychological way to accomplish this. Anyone who thinks otherwise is nieve. What will also probably happen is that the rest of the market will continue to go higher, until the Fed hikes rates to a certain point (predetermined by them) wherein that will be the signal for the big players to dump EVERYTHING hard. This happened after the huge rally in stocks ended in 2000. Up till then, Greenspan was raising rates while the market continued to hit new highs. Then, after his 6th increase, the big players started the dump. They didn't dump all at once because that would be too obvious. There were plenty of nice rallies even after the 6th rate hike. However, the end of the scheme was in motion. It was all pump 'n dump from that point until new lows hit in 2001. People lost $trillions, and Wall cheat blamed it on Greenspan. It was that magical 6th rate hike that caused it to happen (even though the indices hit, or rather were pumped to all time highs after the 5th hike!). So this is what will happen here too. Greenspan takes his orders from the institutions. They want the all the newbie longs on high yield stuff screwed. Dump them now, and you will forever be gratefull for heeding my warnings. Wall street is a cold, cruel game, and if you don't understand how the game works you will lose your ass big time. Greenspan will continue to raise rates until every last long is screwed. He has no mind of his own, despite all of this double-talk. His actions are all at the demand of the big boys.
Well, he does seem a little bit -- odd; but the larger point (rising rates) has me concerned too. Apparently we can look forward to another four years of borrow-and-spend fiscal policy, which one could reasonably suspect to produce higher rates.
I'm equally distrustful in the finacial media and Wall Street in general. But why would the 'big players' want me rattled over my bond fund and REIT positions? I've certainly taken money off the table in anticipation of higher rates but still have my core positions. You're suggesting some kind of conspiricy theory aimed at retail fixed income products and I'm not sure I follow your reasoning.