And also to kick ass conservative.
The Fed manipulates rates by how much credit they extend, but that’s only because there is a market for our debt. If people refuse to buy out debt at 1% over 6 months, and 3% over a year, then they HAVE to raise rates. Why? to get people to buy the debt. That’s when the $hit will hit the fan.
> If people refuse to buy out debt at 1% over 6 months, and 3% over a year, then they HAVE to raise rates. <
That’s an interesting argument. But the Fed recently stepped in and started buying US debt at the current low rates. Where they get the money to do that I have no idea.