Call options on the DIA, QQQs, and the SPY could be a safe bet for December.
All on news the Federal Reserve may hike by smaller amounts going forward. While the central bank still has to be aggressive with inflation, Fed Chairman Jerome Powell says small interest rate hikes are now possible.
“Despite some promising developments, we have a long way to go in restoring price stability,” Powell said in remarks delivered at the Brookings Institution, as noted by CNBC. “It makes sense to moderate the pace of our rate increases as we approach the level of restraint that will be sufficient to bring inflation down,” he added. “The time for moderating the pace of rate increases may come as soon as the December meeting.”
That may help take some pressure off a lot of Americans, too.
As it tried to aggressively fight inflation, it sent the cost of housing, food, energy, and your debt to higher highs. Prices at grocery stores were even up 13% year over year. On top of that, about 61% of Americans, or 157 million adults, are living paycheck to paycheck these days. A year ago, that number sat at 55%. Meanwhile, the personal savings rate plummeted from about 20% in 2020 to below 5% this year, according to Time.com.
According to Forex.com, “A long list of Wall Street banks from Goldman Sachs, JPMorgan to Bank of America have warned that an overly aggressive Fed tightening policy, combined with a surging U.S dollar, risks breaking the global financial markets and causing dangerous instability in other currencies.” Even the IMF, and the United Nations pressured the Federal Reserve to cool it with the hikes.
Now that the Fed is listening, markets could run.
Sincerely,
Ian Cooper
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