Did anyone just hear what the Federal Reserve chief just said today? He plans to continue increasing interest rates and keep them higher for longer. Of course he won’t tell you he’s doing this to weaken the economy just in time for the 2024 election so republicans can use a bad economy as an excuse to bludgeon their way into power. It’s the same pattern the FED RESERVE has been doing the last 100 years. When a republican is president, keep interest rates lower for longer. When a democrat is president, keep rates higher for longer.
And the sad thing is, voters don’t even understand what negative interest rates mean. When Trump was in power, he cried for the FED to go negative with interest rates. This means rich people not only pay nothing on their loans… we actually pay them interest to take out a loan. Yep, Trump wanted us to pay him to borrow money!!! Imagine being paid money to take a loan out to buy a car.
And people want to vote for this clown?
Go check the markets and see how much interest rates and the dollar moved after Powel’s comments.
The good news from all this is I might have a chance to buy a lot more of this municipal bond trust for the long term if the price goes down. Right now it hasn’t budged much. I’m hoping for the price to drop to around $10.15. Higher interest rates from the FED usually mean lower bond prices with higher yields. Let’s see if it happens!
So anytime someone discusses a bad idea from a political party it becomes a partisan issue? So you are telling me Trump advocating for negative interest rates is a great idea we should be debating as a real issue like a public health care option?
How blatantly bad does the idea have to be before it’s not labeled partisan?
If presidents have a minimum age requirement there should be a maximum too. No more extreme senior citizens in office making policies that have far flung future consequences they won’t be alive to deal with
They need to address the individual underlying causes of inflation. A lot of critics with PHD’s said and still say aggressively raising rates wouldn’t be very effective. So far the critics seem to be right. The USA’s inflationary trend is still in lockstep with the rest of the world.
Rates were already super low going into the covid situation in 2020. In order to stimulate velocity of money, they all but removed the bank retention rate (the amount of money banks have to keep in cash reserves relative to the amount they’ve loaned out), the federal funds rate (the amount banks pay each other to lend money between themselves), and the debt window rate (the rate they pay the fed to borrow money to lend you).
The fed interest rate is like a gas pedal in a car. You lower the interest rate, it’s like pressing the gas pedal on money creation because money is created via the debt window. Removing these other rates and restrictions is like putting nitrous and a twin turbo on an engine with the gas pedal already down, and is why more money was created over covid stimulus than any other time period in history. Quantitative easing and stimmy checks were a drop in the bucket.
This is why the stock market and housing market behaved as it did in 2021, and this is what people mean when they talk about the “liquidity bubble”. Huge institutions were allowed to trade and operate on basically infinite leverage over this time. If you already owned stuff going into 2021, it helped you immensely. If not, the long term impacts of that policy just might have made it impossible for you to ever realistically own anything.
Do you seriously believe the FED operates on a partisan basis? Do you seriously think the FED would take orders from a populist leader? Really? Do you know the establishment Republicans hate Trump? This is such a impossibly ridiculous take. Do you get your news from MSNBC? CNN? NBC?
The FED answers to wealth and power far beyond Trump. These are the people that are pushing for war in Ukraine. Pushing for NATO expansion. Pushing for bombing Yemen. Pushing for endless wars.
The US sets the inflationary trend. I guarantee you in short time this will be the prevailing notion. Supply chains during covid were heavily disrupted across the world. We had millions of people staying home and not producing WHILE being paid to do so. This completely shocked the system. During this time as well, manufacturers pulled back on production substantially.
We are still recovering. There are still backlogs of products on order. Just look at the new car market. The waiting list for lots of vehicles is 6-12 months or longer. This is a global problem and that problem mostly stems from the US.
Meh. Silver is down atm and it likely going to stay down. It SHOULD be worth more, but keeping silver/gold down keeps the fear of inflation away. Eventually that will come home to roost.
Gold is a lot better precious metal to invest in. There is actually a global silver cartel that manipulates the price of silver because it is less useful than other metals in manufacturing and stuff. Gold and even copper have a lot more industrial uses and will maintain a lot more of their natural scarcity. Do not ever purchase bonds or other securities that claim to be tied to the value of any precious metal. Just go buy the metal and keep it in a security deposit box in a bank vault.
You’re completely leaving out the context under which interest rates were lowered or raised, and simply equating it to partisan politics.\
Interest rates have been low since 2008 because that’s how you get the economy moving. They were low for the entire Obama presidency. They went even lower in COVID to offset the economic impact of that. They’re being raised because ultimately that caused super high inflation, and to bring that down you have to take money out of the system, which they do with raised interest rates. They went back and revised inflation numbers for the past several months, which is what’s causing them to pivot back to higher rates. It has nothing to do with the president.
Trade supply issues have been fixed and large corporations are making record profits. The problem is that instead of going after these corporations the fed prefers put about 2 mil people out of work over the next year to reduce inflation.
The dollar hasn’t even been backed by any asset since nixon it has no value and it’s not even real. The fed is privately owned ffs
