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Trump's tweet makes no sense and show his ignorance for how debt works in the US.
The Fed could lower the interest rate to 0%, or lower, but that is the over-night rate banks charge each other to move money around. The interest rate for all the debt the US uses to finance its budget deficits is determined by the market when the US Treasury issues a new round of bonds. The two are largely unrelated except for the shortest term securities like 6 month Notes. The standard US security is the 10-year bond and it's yield is completely determined by the open market, not by the Fed.
The difference today is much of the world is in negative interest rate territory. The economy is only a little less puny than it was during Obama's time, and we are at the end of the business cycle. If the fed had bothered raising rates when Obama was in office, than they could lower interest rates and stop at 2% - 3%. But they didn't, and the fed still has a job to do. One of which is softening the landing during a recession, but how can they do that when the interest rates are already ridiculously low? They basically have nothing left in their bag of tricks should the market puke.
The question I ask is, how can you raise interest rates at the end of the business cycle and NOT cause a recession? All the Trump haters want higher interest rates for this very reason, if they have any knowledge of how the markets works.
The difference today is much of the world is in negative interest rate territory. The economy is only a little less puny than it was during Obama's time, and we are at the end of the business cycle. If the fed had bothered raising rates when Obama was in office, than they could lower interest rates and stop at 2% - 3%. But they didn't, and the fed still has a job to do. One of which is softening the landing during a recession, but how can they do that when the interest rates are already ridiculously low? They basically have nothing left in their bag of tricks should the market puke.
The question I ask is, how can you raise interest rates at the end of the business cycle and NOT cause a recession? All the Trump haters want higher interest rates for this very reason, if they have any knowledge of how the markets works.
You mean the rest of the world isn't inflating it's market as much as we are?
Sorry I'm not seeing anyone asking for rates to increase.
I really just see lots of double talk coming from Trump about how good our economy is and never been better. Who is he trying to fool? Oh wait....
The difference today is much of the world is in negative interest rate territory. The economy is only a little less puny than it was during Obama's time, and we are at the end of the business cycle. If the fed had bothered raising rates when Obama was in office, than they could lower interest rates and stop at 2% - 3%. But they didn't, and the fed still has a job to do. One of which is softening the landing during a recession, but how can they do that when the interest rates are already ridiculously low? They basically have nothing left in their bag of tricks should the market puke.
The question I ask is, how can you raise interest rates at the end of the business cycle and NOT cause a recession? All the Trump haters want higher interest rates for this very reason, if they have any knowledge of how the markets works.
Quote:
Originally Posted by TBMorgan
he walked into a decent situation - sure glad he hasn't had a crisis to deal w/ yet
He walked into the biggest expansion cycle this country has ever known and tries to claim it... when convenient.
Which is significantly greater than current growth rates. 2019 GDP is on track to be below 2%.
Trade wars and economic uncertainty due to the maniac in the White House has reduced growth.
Which explains why Trump wants lower interest rates, like much of the rest of the developed world. How healthy do you think Europe's economy is in comparison? China's economy showing strain, and won't be growing at their expected pace until they return to the table and talk trade with Trump and Co. USA winning, that's what Trump was elected to do.
As I said, GDP growth under Trump has been as puny as it was under Obama.
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