The government shutdown is likely to cement additional Fed interest rate cuts | Metals Mine

  • The government shutdown is likely to cement additional Fed interest rate cuts

    From cnbc.com

    If any doubts remained about whether the Federal Reserve will be lowering its key interest rate later this month, the budget loggerheads a few blocks away in the nation’s capital may have cemented the move. Particularly if the impasse stretches out past a few days, Chair Jerome Powell and his fellow central bankers likely will err on the side of caution, which in this case would be a bias towards easing, Wall Street experts say. “The US government shutdown and associated data delays nudge what we judged was already a firmly odds-on Fed rate cut in October further odds-on,” Krishna Guha, head of global policy ... (full story)

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ocd
Oct 2, 2025 1:07am
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Forget politics for a minute and think about macro fundamentals for the next 20 years.

From here on out, rate cuts and inflation are gonna create big swings. Throw AI and robotics in the mix for employment numbers and we're gonna have ourselves one big cluster f**k of a problem until Captain Hyperinflation comes for his final payment.

Now let's get back into politics again. Building divisions and hatred will keep your mind off the fact that politicians are 100% the cause of my opinion above. Who decided to get rid of a gold backed currency? A politician. Who decided to turn the printing presses on for the dollar in 2008? A politician. Just reverse those two decisions and the national debt completely changes course.

Sure, lower the interest rates and keep home prices stupid high or raise interest rates and lower home prices. Either way, government proves it is incapable of making a fundamentally good decision and could care less about it's citizens struggles.
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Subdude
Oct 2, 2025 2:50am
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I see no rational connection between the shutdown and interest rate policy. Risk management cut my ass! The Fed can't bail anyone out by cutting by 25 bp, thinking otherwise is wholly idiotic.
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Trader#6CE8
Oct 2, 2025 2:11am
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Quoting OutThere
What if the shutdown results in chaos and unrest. People out of jobs, services scant, societal tensions..etc, could be a spark. Then Trump will declare martial law with all the powers that come with it. What he can do with all that power who knows? Maybe that is the plan. How many people on all sides wouldn't put it past him?
I here Disney are hiring for new Sci Fi story writers, with an imagination like yours, you should give them a call.
Reply
Subdude
Oct 2, 2025 2:33pm
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Quoting Vancarbon
I don’t see this equity market bubble ending well . It’s purely momentum driven based on fragile expectations of Artificial Intelligence . The algorithms are flipping the same old stocks around to try and maintain the momentum . I’m an interested observer at this point
There are increasingly many who have made the same observation: https://www.techspot.com/news/109626...-together.html
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KimKim23
Oct 2, 2025 6:09am
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Quoting Subdude
I see no rational connection between the shutdown and interest rate policy. Risk management cut my ass! The Fed can't bail anyone out by cutting by 25 bp, thinking otherwise is wholly idiotic.
There is a relation. How many companies directly and indirectly contract with the US govt? what happens to their payments when the govt shuts down? They begin to layoff workers as a way to maintaining their operations. If the govt decides on budget cuts dont you think this will affect the operations of companies contracting with the govt? the issue now is the high debt that the govt has, if you are the lender (the Fed) of said govt debt and your client is complaining about the debt and wants to reduce business of borrowing from you, dont you think it makes sense for you to entice them back to the table by lowering the cost of new debt (lowering interest rates) so as to make your client (the govt) feel confident to borrow more from you? The Fed is like a loan shark, and a loan shark will cut its interest rates if its clients are considering lifestyle changes to avoid borrowing more money. The fed will definitely cut interest rates more aggressively than planned due to the current state of events. Think like a banker and you will know how the Fed is likely to behave.
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OutThere
Oct 2, 2025 1:29am
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What if the shutdown results in chaos and unrest.
People out of jobs, services scant, societal tensions..etc, could be a spark.
Then Trump will declare martial law with all the powers that come with it.
What he can do with all that power who knows?
Maybe that is the plan.
How many people on all sides wouldn't put it past him?
Reply
Real-sam
Oct 2, 2025 6:44am
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Government shutdown = weaker economic outlook = higher chance of Fed cuts = USD weakness in medium-term. This news increases probability of USD bearish moves in the coming weeks, Fed commentary confirming cuts that’s when markets usually react strongly.
Until then, USD may stay volatile with a tug-of-war between safe-haven demand and rate-cut expectations.
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Vancarbon
Oct 2, 2025 3:15am
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I don’t see this equity market bubble ending well . It’s purely momentum driven based on fragile expectations of Artificial Intelligence . The algorithms are flipping the same old stocks around to try and maintain the momentum .

I’m an interested observer at this point
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Vancarbon
Oct 2, 2025 2:52pm — Edited
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Quoting Subdude
{quote} There are increasingly many who have made the same observation: https://www.techspot.com/news/109626...-together.html
Great article , on the money .

Thanks

The market will be closed more than likely over the weekend when the sell off starts , that’s generally the case .

Something totally innocuous could be the reason once momentum fades .
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Subdude
Oct 2, 2025 1:06pm
Permalink
Quoting KimKim23
{quote} There is a relation. How many companies directly and indirectly contract with the US govt? what happens to their payments when the govt shuts down? They begin to layoff workers as a way to maintaining their operations. If the govt decides on budget cuts dont you think this will affect the operations of companies contracting with the govt? the issue now is the high debt that the govt has, if you are the lender (the Fed) of said govt debt and your client is complaining about the debt and wants to reduce business of borrowing from you, dont...
Did you have AI write this? Cutting the overnight borrowing rate (the only rate within the Fed's direct control) does literally nothing to borrowers ability to pay off their debt, nor does it help the Treasury as a vast majority of US govt debt is in 2+ year maturity bonds. Furthermore, the Fed doesn't lend money directly to consumers, acts as the lender of last resort to banks, and NEVER lends money to the government - instead it buys government securities like bonds when it needs to inject liquidity into the system (e.g. QE). It will not entice anyone to take on more debt by lowering the rate, especially by a marginal amount - not to mention the fact that whole monetary system is already an insane debt bubble.
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KimKim23
Oct 22, 2025 10:32am
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What we are seeing in the US is typical in developing countries where the Executive arm of govt tries as much to meddle in the affairs of an independent central bank. Trump is doing all he can to force the Fed to lower the rate so that his govt can borrow more at a cheaper rate to finance their govt spending. I never said that this will affect PAST debt obligations, what i said is that the govt of the day want a cheaper borrowing facility to do its thing. Past debt still gets paid at whatever rate the bids were settled at. Trumps govt may push through with their projects if they get the Fed to go lower, or they may cut down on their intended spending if the Fed doesn't play ball. So if they cant borrow at better rates they will just cut spending by shafting the Democrats policies and moving that money to fund Trumps projects. Anyway we will see what happens.
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Trader#0598
Oct 2, 2025 1:51am
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Quoting OutThere
What if the shutdown results in chaos and unrest. People out of jobs, services scant, societal tensions..etc, could be a spark. Then Trump will declare martial law with all the powers that come with it. What he can do with all that power who knows? Maybe that is the plan. How many people on all sides wouldn't put it past him?
You a person who lives up to his name
Reply
Vancarbon
Oct 2, 2025 3:34am
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When I look at the US equity market charts I see Japan in the 90,s .

The similarities are uncanny -debt mountain , valuations and stagnation .
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Nick.
Oct 2, 2025 3:17am
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Trump got what he wanted: chaos and distraction.
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KimKim23
Oct 22, 2025 10:11am — Edited
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Quoting Subdude
{quote} Did you have AI write this? Cutting the overnight borrowing rate (the only rate within the Fed's direct control) does literally nothing to borrowers ability to pay off their debt, nor does it help the Treasury as a vast majority of US govt debt is in 2+ year maturity bonds. Furthermore, the Fed doesn't lend money directly to consumers, acts as the lender of last resort to banks, and NEVER lends money to the government - instead it buys government securities like bonds when it needs to inject liquidity into the system (e.g. QE). It will not...
I dont use Ai to opinonate for me, i do it the old fashion way by penning down my thoughts. Cutting the rates makes new loans cheaper which allows more people to be able to afford to buy things like property which they would otherwise be hesitant to do due to the higher cost of financing. The US govt will likely continue run at a deficit budget, they have done so each year since 1971 with an of exception of only 4 years (1998 to 2001) out of the last 50 years of budget deficits. Current global debt to GDP ratio is at 93% and is expected to be at 100% of debt to GDP by 2030. The US govt will continue to borrow money to fund its operations and having a lower fed rate will make that new debt cheaper to service especially if the govt of the day is interested in embarking on largescale enterprise restructuring projects (bring the jobs back home) and foreign excursions (rebuilding projects in Palestine and new wars like in Venezuela, oh plus trade wars with China), the AI tech race, e.t.c. All these require significant govt spending so more borrowing. Trump has been clear even in his first term that he wanted the Fed to lower rates during his presidency to make it cheaper for his govt to fund all the projects they wanted to engage in. You are partially right about the central banks not being the direct lenders of govt debt, they are the equivalent of a market maker and act as the intermediary between the Commercial banks (and all other buyers of govt debt) and the Treasury which is the borrower. Remember though that the Fed still maintains a stake in those debt instruments and you can see that when the Fed releases its balance sheet, so it does actually hold/own some of that debt.
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badman143
Oct 2, 2025 5:40am
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m
Quoting Nxti
What does this mean to the forex market
means the USD is likey going to weaken and also rate cuts by the fed coming up real soon due to the shotdown
Reply
Nxti
Oct 1, 2025 11:59pm
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What does this mean to the forex market
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Trader#7545
Oct 2, 2025 3:32am
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Quoting Trader#E581
{quote} Politican are destroing everything tjey want just Money Money look on Trump he destroyed USA dolar is now -10% in history is just one year bader 2003 with -14% fed was doing good job from covid everything in good direction And this clown ruined all
Blame on Trump for all these happened he will probably blame the bad economy to the former President Byden lolzzzz so GG this country need a reform revolution to have a better life hahaha and they still want to compete with China zZzZzz hahaha
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muraina
Oct 2, 2025 7:03am
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since the government is in lock down state will those news that are tentative be released or not? Please help me out
Reply
Ismz
Oct 2, 2025 12:49am
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Please update the gold direction go today !
Reply
Trader#E581
Oct 2, 2025 1:40am
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Quoting ocd
Forget politics for a minute and think about macro fundamentals for the next 20 years. From here on out, rate cuts and inflation are gonna create big swings. Throw AI and robotics in the mix for employment numbers and we're gonna have ourselves one big cluster f**k of a problem until Captain Hyperinflation comes for his final payment. Now let's get back into politics again. Building divisions and hatred will keep your mind off the fact that politicians are 100% the cause of my opinion above. Who decided to get rid of a gold backed currency? A politician....





Politican are destroing everything tjey want just Money Money look on Trump he destroyed USA dolar is now -10% in history is just one year bader 2003 with -14% fed was doing good job from covid everything in good direction And this clown ruined all
Reply
Kellyuganda
Oct 2, 2025 3:32am
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This means the US Dollar might drop
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LightShadow
Oct 2, 2025 4:11am
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gold can up to 3882
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Sadeks
Oct 2, 2025 9:07am
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yeah cut rates but you cannot now, no economic reports during shutdown.
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mduduzi56
Oct 2, 2025 10:25am
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Quoting Trader#459F
no news
no..they will be delayed
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Trader#3A40
Oct 2, 2025 10:59am
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Meanwhile, points to be collected on the UP and DOWN sides, yet again.

Bulls make money, bears make money and little whiny piggies get slaughtered.

Mmmmmmmm pork chops.

Inserted Video
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whoishe
Oct 4, 2025 5:15pm
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Quoting Trader#6CE8
{quote} I here Disney are hiring for new Sci Fi story writers, with an imagination like yours, you should give them a call.
lol
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Trader#2A8D
Oct 2, 2025 3:40am
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What's the update on gold
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Trader#CDF9
Oct 2, 2025 4:06am
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Gold is gonna touch 4000 then
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Trader#B7FA
Oct 2, 2025 4:58am
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Fed is a scam.
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Trader#4CD6
Oct 2, 2025 5:06am
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trump gets what he wants (rate cut), not why he wants it (the economy is bad)

be careful what you wish for
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Trader#3A71
Oct 2, 2025 5:38am
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lol
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Trader#3A71
Oct 2, 2025 5:39am
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why does it say tentative without any timings, I am in a trade and I see a random 200 pip candle opp. my direction, I'm dead!!
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Trader#D306
Oct 2, 2025 6:32am
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it means btc will be bullish.
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Trader#17E6
Oct 2, 2025 6:56am
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its bullish]
Reply
Trader#459F
Oct 2, 2025 7:47am
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no news
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Trader#3910
Oct 2, 2025 7:54am
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Some yahoo thinks the fed will cut rates for the rest of the year which is not likely.
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Trader#CAF8
Oct 2, 2025 8:08am
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Lol
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Trader#9F11
Oct 2, 2025 8:12am
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If Trump goes on vacation... something is afoot
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Trader#1FA9
Oct 2, 2025 8:29am
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No data, no decision.
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Trader#9E68
Oct 2, 2025 10:46am
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Bullish boys
Reply
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