We'll start this essay with the latest news from the Federal Reserve...
On Wednesday afternoon, the Fed raised its benchmark interest rate by another 75 basis points. This came as no surprise to Wall Street.
The move will bring the federal-funds rate range – which most directly matters for banks and then filters throughout the economy – to between 3% and 3.25%. The change makes borrowing costs in the U.S. the highest they've been since before the 2008 financial crisis... and it's the first time rates have eclipsed their previous cycle peak since before the dot-com bubble...
Maybe it's just a coincidence?
As is a quarterly custom, the Fed's board members also published their updated projections for interest rates (the so-called dot plot), gross domestic product ("GDP"), inflation, and unemployment through the end of the year and for the next two years.
Here's where it gets interesting...