Another Federal Reserve interest rate, another … interest rate increase? This is the current dynamic in the entire financial return of the real-time market interest-a week after the first cut of the political interest rates of the Fed for almost a year. Many consumer loans such as home capital and mortgages and credit cards – and even bank deposits take their information from bond yields. The most important questions for investors are now: Why does that happen? And … what should we do, if at all? The answers to both questions begin with the bond in which the Fed is located, since it is with its two mandates – promoting price stability and maximum employment – that are currently opposed to each other. Lately there have been signs of a slow labor market for the Fed more worrying than an increase in overall inflation. The former naturally supports breasts to stimulate employment demand, while the latter uses to keep interest rates high in order to reduce increasing prices. While the FED made it clear that the job market must be in the driver's seat, the bond market is not so sure. When it comes to bonds, the yields are locked up when buying. So if you buy a 10-year ministry of finance or give the US government's money for the next decade, the current return of around 4.2% is the one with which you hold on to maturity. (Bonds are constantly traded before they mature, which leads to fluctuations in the yields that move around the price. But that's a completely different story.) As a result, you must think about real returns – the yield minus the inflation rate – in a time horizon that mature the bond. In other words, before you block at a speed for 10 years, you have to consider what inflation can look like over the decade. Incorrectly calculated and takes over too low inflation rate. Of course, we do not say that the FED has to reduce interest on 25 basis points last week. We have previously argued that the labor market deserves more focus, because if inflation actually increases due to tariffs, this is more temporary in nature than an increase in unemployment. This applies in particular if unemployment causes companies to take on artificial intelligence solutions faster – and in turn, less than human work are structurally dependent on human work. Horse and buggy repair man, someone? Tariffs, on the other hand, are probably a unique phenomenon. While the price increases remain, the price increase decreases when we meet the date of implementation. However, since inflation still above the goal of the Fed 2% and the central bankers who lower the guideline rate that affect the low end of the bond market return, it is clear that the dealers for bond markets are of the view that they have to protect themselves against the move. In other words, to protect yourself from an inflation back that is supported by reducing the short end to protect the labor market, the bond market, which works on the dynamics of the free market, sells the long end, which drives the yields for these longer dated treasure hands. Understanding why the yield curve does what it does is only half of the battle. The other half finds out what to do about it. We do not think what the fiscal or monetary authorities should do about it – we certainly do not envy the position that fed chairman Jerome Powell finds – but what we should do as investors in terms of positioning. For the beginning, we have to determine whether you believe that the current dynamic applies. As it looks now, we don't really see why it wouldn't do. Inflation still runs hot, the Fed cuts and the tariffs are still intact when the trade negotiations attract themselves. It makes sense that those who buy at the long end would require higher returns to lock their money in the long term. So far, the story seems to be repeated. When the FED provided 100 basis points over three interest rate cuts at the end of last year, the bond yields rose. Sure, slow jobs and tariffs were not factors. It was inflation front and middle. However, the rental income took back to the interest in the interest in September 2024 in order to rise afterwards. If this year will be like last year, it may be time to book our victory in the home depot and step into the sidelines? Jim Cramer asked Jeff Marks, director of the portfolio analysis for the club, exactly this question during the morning meeting on Thursday. Jim said that trading in the home depot depends on the decommissioning of apartments and depends more on the mortgage interests than on the Heloc interest rates (short-term equity lines) for renovation work. However, when long bond yields start, we may only look at a short retreat to Home Depot shares. Jeff said something should be taken into account and should be monitored. Of course, this way of thinking applies to all stocks that have members who are bound to the longer end of the yield curve. Fortunately, before the opening bell on Friday, we will receive an important update for inflation, with the publication of the price index for personal consumption expenses (PCCE). Core PCE, which excludes food and energy prices, is the Fed's favorite beam for the price pressure in the economy. In view of the concerns about inflation, it is crucial that we have at least a reading in line – if not below – what the street is looking for. From Thursday, the Kern -August -Pce will increase by 2.9 %compared to the previous year. At the beginning of this month, the core sentence in August Consumer Price Index – another important level for inflation retail – rose by 3.1%compared to the previous year. Although no apples and apples comparison with the PCE, we will look for a confirmation or the objection of what the CPI unveiled. (Jim Cramers Charitible Trust is long. Here you will find a full list of shares.) As a subscriber of the CNBC Investing Club with Jim Cramer, you will receive a trading warning warning before Jim is trading. Jim waits for 45 minutes after he has sent a trade warning before bought or selling a share in the portfolio of his non -profit trust. When Jim spoke about a share on CNBC television, he waits 72 hours after the output of the trade war before he executed the trade. The above -mentioned investment club information is subject to our general terms and conditions and data protection guidelines together with our disclaimer. There is no trust or strategy or is created due to its receipt of information provided in connection with the Investing Club. It is not guaranteed to be a specific result or profit.