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Just goes to show how great this economy is if the Fed wants to slow it down. I don't recall the Fed doing that when Obama was president. If anything they kept interest rates at zero which screwed people with savings accounts
Regardless, it never made sense to me to slow down a good economy. I don't remember us having Venezuelan type inflation rates. The elites just want to screw Trump and they can afford to take a hit while the poor and middle class can't. Shame on them!
You do realize that this country's economy was going down the toilet even before Obama took office. Then came Bear Sterns, Lehman Brothers, and the entire US and pretty much entire world's financial/credit sectors crashing leading to deep recessions if not economic depressions. You knew that before making such statements, didn't you?
Paul A. Volcker, and his federal reserve were widely blamed for a host of political and economic ills. Yet it was he and they who finally were able to wring the disastrous inflation (stagflation) out of the US economy.
Remember those people who loved a free market? Well, a free market would say interest rates should go way up. What would a good investor need in terms of return to lend money to a "middling" credit risk for a new car? Or for home renovations?
Depending on the scenario, 7% to 12% (or more) is the right number.
People have to pick one. If the "economy is the best in our history" then having rates the same as they were at other boom times should be fine.
If, however, the economy is going nowhere...then we have to give people cheap or free money so they think they are doing well.
It's about the psychology of it all. These rate hikes are roiling markets which upsets people.
Stock market has largely been divorced from reality for a few or several years now. In many cases you have things trading way above what the fundamentals say they should based upon God only knows what information.
Money has been pouring into the stock market for past several years as investors and others chased yields because quite frankly there wasn't any place else to go. Interest rates (thanks to Federal Reserve) on savings, CD and others such accounts was nil to otherwise not worth bothering, so people needed to make money somewhere.
The free money Bernanke and Yellen showered the economy with may or may not wholly been necessary at the time; but things on ground have changed, and it is time for the Fed to take that punch bowl off the table.
Investors who have made bank out of money from nothing are going to need to find some other way to pull off that magic trick.
This bull market has had an incredible run. Those who left their money in while world was crashing down, and or invested early in the recovery have done *VERY* well on average. As the saying goes; something that cannot go on forever must stop....
Remember those people who loved a free market? Well, a free market would say interest rates should go way up. What would a good investor need in terms of return to lend money to a "middling" credit risk for a new car? Or for home renovations?
Depending on the scenario, 7% to 12% (or more) is the right number.
People have to pick one. If the "economy is the best in our history" then having rates the same as they were at other boom times should be fine.
If, however, the economy is going nowhere...then we have to give people cheap or free money so they think they are doing well.
Correct
Recipe for inflation = Low interest rates + 3.7% unemployment rate + rising wages
The Feeds job imho is to manage inflation first and foremost.
Watch Trump END THE FED and all the worlds problems.
>>> That would certainly help put a dent in this country's problems. And if it spilled over to the global banking elite it would make a positive impact economically and against terrorism.
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