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I wonder how this benefits low wage workers...in addition to paying 20% more for gasoline, they all are going to be paying more for all their (vast) debt. Mortgage. Even their employers will be paying more interest on all their debts and mortgages and capital equipment....meaning less for wages.
As it stand there is zero wage growth when inflation is figured in - and that is before these hikes.
What is the end game here? Those of us who are financially secure could care less...we welcome higher interest rates. But the vast majority of people, including the forgotten man Trump said would be working his arse off and back in the saddle...they are gonna be hurting....
MAGA. Or MBGA (Make Banks Great Again).
Wow, the lack of economic knowledge in your post is astounding.
Interest rates need to be raised. Should have been done much sooner. This is a sign of a growing economy, so stop griping - unless, of course, your TDS is so severe that you would rather see the economy tank than see Trump get credit for it improving, in which case you're a partisan hack.
Low wage earners shouldn't have debt. If they do, they've made some seriously bad life choices. If you're living paycheck to paycheck the last thing you need is a credit card. A mortgage is doable on a low wage, but if you got a mortgage with a variable rate while making anything close to minimum wage you screwed up somewhere.
Note: Judging from this post, if you personally are financially secure then you got there through inheritance, lottery winnings, sheer luck, or someone else managing your money. There is no way that you managed to become financially secure with the knowledge you show in this post.
I hate to say it but, real estate prices do need to come down some. Cheap money has led to this massive increase in home valuations and I don't think the true value matches what the prices are. Sure, a house will appraise for $300k but that doesn't mean that is what that same house should actually sell for. Real estate ran up hard in the early to mid 2000s and it's doing it again. I think the market needs to be slowed down a little bit in order to keep from having a repeat of the bubble popping. I think this even if it means some people will lose some of their perceived equity. The question could be, lose 5% or lose 40%? Sadly, this will hurt me and my business but I think it needs to be done. Cut off a foot to save the leg.
20% down payment, problem solved. I'd also lie to see the end of the mortgage interest deduction.
As it stand there is zero wage growth when inflation is figured in - and that is before these hikes.
What is the end game here? Those of us who are financially secure could care less...we welcome higher interest rates. But the vast majority of people, including the forgotten man Trump said would be working his arse off and back in the saddle...they are gonna be hurting....
MAGA. Or MBGA (Make Banks Great Again).
I was expecting a legit, rational discussion of what might happen to the yield curve as a result of this but instead its just another hate Trump thread.
Agreed. I hate Trump but he has nothing to do with the Fed's actions. The Fed tends to raise rates when the economy is doing great and lower them when the economy is sluggish. Politics are irrelevant in their decisions.
Agreed. I hate Trump but he has nothing to do with the Fed's actions. The Fed tends to raise rates when the economy is doing great and lower them when the economy is sluggish. Politics are irrelevant in their decisions.
Its effects are also over stated.People get this idea that during a recession that low interest rates are going to discourage saving and increase investment? Where do they get this idea? Retired people draw income from interest payments. Increasing interest rates increase their income . Lowering it makes them spend less. Low interest rates caused Illinois to raise taxes because low interest was dying up the pension funds. How did higher taxes to feed the pension funds stimulate anything?
In addition to this what makes people think low interest rates make borrowing harder? When the interest rate is higher, more people are willing to lend. People chase higher yields.
Interest rates have been and still are near historical lows. I believe that in the 70's it was common for people to be paying double digit interest rates. It was an era known as "Stagflation" under Jimmy Carter.
Interest rates have been made so low as a means to stimulate the economy. Right now our economy is dependent upon massive debt and low rates of interest. Indeed, debt is encouraged via low rates of interest. Now that interest rates have been low for so long, people think that is normal, but its really abnormal. It just encourages more debt and ramps up housing prices and the like.
Here is the thing, though. Our economy would take a big economic hit or depression if the nation tried to normalize interest rates and debt. The economy is dependent upon those things. So expect a slowing of the economy by the end of the year.
That interest rate hike was the result of the previous years of wage and price controls. The first time they came off, everyone who had a product to sell raised the price as much as they could fearing another round of wage and price controls.
When the hostages were taken the price of gasoline went through the roof.
Even when mortgage rates were close to 10% people were still buying houses.
Agreed. I hate Trump but he has nothing to do with the Fed's actions. The Fed tends to raise rates when the economy is doing great and lower them when the economy is sluggish. Politics are irrelevant in their decisions.
Another way of putting it: the fed takes away the punch bowl just when the party is going good.
I wonder how this benefits low wage workers...in addition to paying 20% more for gasoline, they all are going to be paying more for all their (vast) debt. Mortgage. Even their employers will be paying more interest on all their debts and mortgages and capital equipment....meaning less for wages.
As it stand there is zero wage growth when inflation is figured in - and that is before these hikes.
What is the end game here? Those of us who are financially secure could care less...we welcome higher interest rates. But the vast majority of people, including the forgotten man Trump said would be working his arse off and back in the saddle...they are gonna be hurting....
MAGA. Or MBGA (Make Banks Great Again).
Not surprised. The interest rates have been artificially low for a long time. I have said earlier that the globalists on the Federal Reserve would try and raise it now and then blame Trump for the resulting economic problems.
As for the zero wage growth thing, I agree that he should be doing more to stop illegals and H1Bs (you know, like he promised), who are definitely bringing wages down, but let's not pretend that that issue started with Trump. It's been going on since Dubya was in office.
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