Posted on 12/18/2018 5:38:26 AM PST by Moonman62
I hope the people over at the Fed will read today’s Wall Street Journal Editorial before they make yet another mistake. Also, don’t let the market become any more illiquid than it already is. Stop with the 50 B’s. Feel the market, don’t just go by meaningless numbers. Good luck!
If interest rates are zero then who would buy the debt?
Actually, both Trump AND the Fed are right, but it’s just a matter of timing. We are still coming off a 35 low in interest rates and with our economy doing as fantastic as it is the short term rates should be a little higher.
That said, thanks to the troubles in France, Italy, England and China the global appetite for high quality long bonds has brought down US long term rates. The Fed is pushing a noodle to try to change things at this point, so the correct thing to do RIGHT NOW is a “wait and see” (IMHO).
If interest rates are zero then who would buy the debt?
...
Ask the people who have bought government debt at zero. I believe some have bought at below zero.
The Fed rate has never been at zero. Or below zero.
People don’t buy Fed rates, they buy government bonds.
And I’m not just talking about US bonds.
Fed raises rates by 1/4 percent. Not a big deal. Market tanks. Great buying opportunities. Manipulation anyone (not by the Fed)?
I think you’re right about the depression/funny money part, but the Fed allowed the economy to implode with their lack of interest rate increases back before the ‘07/’08 crash. Houses were increasing in price faster than wages could support. Thus, there was so much lender-induced Tom-foolery used to shoehorn people into houses...people that should never’ve owned a house...the trickery finally caught up with the market, and the bubble burst. Even the homeless, sleeping in their cars in the Wal-Mart parking lot, were finally buying houses. (Heck, we refinanced twice during that period...both 15year fixed...and we’re still benefiting from that.)
If the Fed really wanted to help America, they could judiciously adjust rates up our down to control the overheating or slowing of the market, but they don’t. The Fed uses their “power” for political harm...and I think...mostly to harm Republicans.
That’s actually true to a large degree, but is also why they should have raised rates more than one 0.25% under Obama. 50 bps a year from 2011 to 2016 would have had the FFR at 3.25% going into Trump’s presidency with 0 FFR hikes. It’s instead at 2.25% with 7 FFR hikes under Trump. But we all know why they didn’t raise rates under Obama.
can precious metals be in the form of jewelry? Can’t afford to buy gold coins but I have gold jewelry.
Because with the exception of the last year or so, the economy under Obama was nowhere near as robust as the economy under Trump has been.
Not quite. He thinks these are mistakes. Or perhaps he does recognize they are deliberate actions and is just saying nice doggie while looking for a skull crushing rock?
Laffer curve. Lower taxes=more money in the private sector=more spending on goods and services=more jobs providing goods and services=more tax payers=more government revenue.
It's not about government revenue, it never has been. It's about punishing people for being successful if they don't owe their "success" and their votes to government largess.
The part about that the absolutely terrifies the democrats, the part that has them waking up in a cold sweat every night is more jobs and more self-sufficiency, the less likely people will vote democrat.
Correct. But it was growing fast enough for 1-2 rate hikes a year for most of that time. They did not do that, however.
But the laffer curve recognizes that when you are to the left of the mid-point reducing taxes reduces revenues.
It's not about government revenue, it never has been.
True. It's about the government spending more than it takes in.
Yeah, Null & void gets it!!!
True. It's about the government spending more than it takes in.
No argument there!!!
Here’s validation for your thread the other day—from the President no less!
How do you know?
We know that because every-time marginal rates are lowered income tax revenue increases. Get it? No, you don't. You are incapable.....
Funny, I read your posts and I don't feel all that incapable. What would revenue have been under the old rates last year? How does that compare to the revenue collected, higher or lower? That's how you determine where on the curve you lie.
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