What Is ONE

On September 12, according to CCTV International News, a CBS reporter visited the USS George Washington, which is currently on a mission in the Middle East, on September 11. The report stated that the aircraft carrier carries approximately 5,000 personnel along with a large amount of ammunition and fighter jets, making it a key asset for the US military's tactical operations against Iran, and one of Iran's primary targets. The report also mentioned that the US Navy confirmed Iran attempted to attack US warships with ballistic missiles last weekend. The USS George Washington arrived in the Middle East on August 19, replacing the USS Abraham Lincoln, which had encountered difficulties.

On September 12, Nick Timiraos, known as the 'Fed's Voice,' stated in a recent article that investors have largely accepted that the Federal Reserve will raise interest rates next week for the first time in years, but the more challenging question is what will happen afterward. Since almost no one within the Fed believes that a single 25 basis point hike will be sufficient to curb inflation, a rate increase next week would reflect a judgment that previous rates were set incorrectly, and one hike alone will not resolve the issue. Since the 1990s, the Fed has only implemented one 'one-time' rate hike. Walsh stated in July that he does not believe the Fed excels at 'fine-tuning,' and analysts suggest that a chairperson skeptical of fine-tuning is unlikely to declare the mission accomplished after a 25 basis point hike. Walsh mentioned last month that there is not much evidence indicating that borrowing conditions are restricting economic activity. If a rate hike is pushed for this reason, the market will naturally question how high rates need to rise. Without sufficient explanation, the market may interpret a single hike as the beginning of a larger scale action. Therefore, this week, investors are no longer viewing the September meeting as a one-off event. The market currently expects that by June of next year, the cumulative number of rate hikes will reach at least three, higher than the previously anticipated two.

On September 12, Nick Timiraos, often referred to as the 'Fed's Echo,' stated in a recent article that investors have largely accepted that the Federal Reserve will raise interest rates for the first time in three years next week. The more difficult question is what will happen afterward. Since almost no one within the Fed believes that a single 25 basis point hike will be sufficient to lower inflation, a decision to raise rates next week would reflect a judgment that rates were previously set at the wrong level; one hike will not resolve the problem. Since the 1990s, the Fed has only implemented a 'one-off' rate hike once. Walsh indicated in July that he does not believe the Fed is good at 'fine-tuning.' Analysts suggest that a chairperson skeptical of fine-tuning is unlikely to declare the job done after a 25 basis point increase. Last month, Walsh stated that there is not much evidence showing that lending conditions are restricting economic activity. If a rate hike is pushed for this reason, the market will naturally question how high rates need to go. Without adequate explanation, the market may interpret a single rate hike as the beginning of a larger action. Therefore, this week, investors no longer view the September meeting as a one-time event. The market currently expects that by June of next year, the total number of rate hikes will reach at least three, higher than the previously anticipated two.