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Old Today, 12:25 PM
 
9,352 posts, read 2,862,333 times
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So looks like Trump he is getting his wish. Pressure the Fed to lower interest rates then screw the pooch on the trade war to make sure they do. Once he gets the interest rates where he wants them, then all will be back on track with China. Pure manipulation. But I guess we all knew that. That's what he was aiming for all along. He doesn't care about the trade inequities, the farmers or anyone else. He cares about his financial success and making sure the stock market facilitates that.

https://www.cnbc.com/2019/08/12/fed-...near-zero.html

Last edited by trobesmom; Today at 01:33 PM..
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Old Today, 12:50 PM
 
Location: Metro Detroit, Michigan
12,707 posts, read 14,091,605 times
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The interest rates were extraordinarily low during Obama's time in office. It created a bubble in equities that is not sustainable. Nothing magically changed when Trump became president, but the Fed insisted that it was time to start cranking up the interest rates. They tried, and it made the market wobble. Lefties started whining and crying that Trump was hurting their portfolio, Trump is a racist, etc. So the Fed backed off from manufacturing a new economic and financial crisis, one of the few things they are good at doing (besides killing productive US industries and making farming a living hell).

If you want to talk about manipulation, examine the role that the Fed serves, and what their purpose of existing is.
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Old Today, 01:18 PM
 
289 posts, read 141,743 times
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This entire country runs on debt. If people and company's stop borrowing the house of cards falls.
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Old Today, 01:20 PM
 
1,453 posts, read 320,173 times
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We are coming to the end of a debt supercycle. Negative rates will just make the problem worse around the world. More bad debt will exacerbate the problem. I would recommend anyone interested in this topic look up Ray Dalio's work and comments on debt supercycles. He basically is saying we are around inning 8 of this debt suprecycle. Innings 8 and 9 are no fun at all.........
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Old Today, 01:23 PM
 
Location: Sonoran Desert
29,502 posts, read 39,970,889 times
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It is not Trump getting his way with the Fed. The banks see lower rates because of economic weakness and a recession becoming more and more likely with each passing day. The Fed will use what limited tools it has to stop it or shorten it. Trump is much of the reason that the economy is failing when just about everyone thought this cycle still had legs. Other than than, he is just noise
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Old Today, 01:37 PM
 
9,352 posts, read 2,862,333 times
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Quote:
Originally Posted by andywire View Post
The interest rates were extraordinarily low during Obama's time in office. It created a bubble in equities that is not sustainable. Nothing magically changed when Trump became president, but the Fed insisted that it was time to start cranking up the interest rates. They tried, and it made the market wobble. Lefties started whining and crying that Trump was hurting their portfolio, Trump is a racist, etc. So the Fed backed off from manufacturing a new economic and financial crisis, one of the few things they are good at doing (besides killing productive US industries and making farming a living hell).

If you want to talk about manipulation, examine the role that the Fed serves, and what their purpose of existing is.
Oh yeah, the Fed definitely manipulates. My point is Trump has been trying to pressure the Fed for months to lower the interest rates. It sure appears that this ratcheted up trade war would cause enough of an economic problem to warrant that happening. He gets his wish.
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Old Today, 01:43 PM
 
Location: Metro Detroit, Michigan
12,707 posts, read 14,091,605 times
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Quote:
Originally Posted by trobesmom View Post
Oh yeah, the Fed definitely manipulates. My point is Trump has been trying to pressure the Fed for months to lower the interest rates. It sure appears that this ratcheted up trade war would cause enough of an economic problem to warrant that happening. He gets his wish.

So you are you suggesting that Trump started a trade war with China for the sole purpose of bringing interest rates down?
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Old Today, 01:52 PM
 
722 posts, read 383,525 times
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Quote:
Originally Posted by Ponderosa View Post
It is not Trump getting his way with the Fed. The banks see lower rates because of economic weakness and a recession becoming more and more likely with each passing day. Trump is just noise.
Jerome Powell's views on monetary policy were well known when President Trump nominated him to serve as Fed Chair in 2017. Rather than picking someone who would do what is right for the country, he nominated someone who is a dove.

In the last decade, we have barely moved away from a 0% federal funds rate, and after gradual increases which were far too gradual to begin with, we are now moving back towards zero. I don't know that there is a magic number, but I think at this point the Fed should move to a 3.25% federal funds rate at their next meeting.

Remember, in 1979, Paul Volcker took interest rates from 11% to 20% in just two years. Following the 1982 recession, which was a correction in the economy, we saw 38% economic growth in the succeeding years. Our economy today has grown at just 25% in the last decade. So the Fed's policy has failed to maximize employment when compared to similar periods of time. The reason is, the fed can't create employment, only the market can. At the same time, if you believe the bogus CPI numbers, the inflation rate relative to prices between 1980 and 1990 fell from 10.3% to 5.4%, compared to an increase from a negative rate of -0.4% in 2009 to 2.2% last year, according to numbers the Fed of Minneapolis put out (source: https://www.minneapolisfed.org/commu...ion-rates-1913). Now, some folks who believe in the Phillips Curve would argue that what we are experiencing today is a consequence of the Phillips Curve, to which my response is look at the 1980s when you had declining unemployment and inflation. Furthermore, today it isn't that more people are employed, but rather than more people are working multiple jobs. The consumer is in debt. We have a $20 trillion national debt that gets a lot of coverage, but what isn't talked about as often is the $13 trillion in consumer debt. People are using credit and other IOUs as opposed to cash. Most of the real inflation is in the stock market, bonds etc.
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Old Today, 01:55 PM
 
9,352 posts, read 2,862,333 times
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Quote:
Originally Posted by andywire View Post
So you are you suggesting that Trump started a trade war with China for the sole purpose of bringing interest rates down?
I don't know what I'm suggesting. I just find it awfully convenient. Trump couldn't care less about farmers. It's all about the stock market.
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Old Today, 02:25 PM
 
Location: Metro Detroit, Michigan
12,707 posts, read 14,091,605 times
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Quote:
Originally Posted by trobesmom View Post
I don't know what I'm suggesting. I just find it awfully convenient. Trump couldn't care less about farmers. It's all about the stock market.

How do you know what Trump cares about? Did you ask him, or are you just looking to take jabs because you don't like him? Not a day goes by without leftists spewing hate towards Trump en mass, often making erroneous and patently false claims to justify their hatred. For most leftists, Trump can do no right, especially when he is doing right for America.

BTW, China chose to no longer buy our agricultural products. Trump did not force them to take such drastic measures. Now China's population is suffering from rising food prices and a decline in consumer product prices. The money they have managed to save will be worth less as China's currency loses value. Currency wars generally follow trade wars.

Right now, only about 20% of Americans are seeing any real impact from the trade war. Most Americans are happily, blissfully unaware, and they don't care to learn about all this stuff you are complaining about. Life is not perfect, but it wasn't perfect before, that's all most people know. Leftists bullying and threatening people to buy into their rhetoric is more a burden than a trade war with China at the moment.
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