Way to jawbone them, Mr. President.
Gold dropped
Market dropped
Market mostly drops when Powell talks on FOMC day
Bad choice for Fed chairman.
At least it’s a cut.
Half surprised they didn’t raise it 0.50%.
Excellent!!!
I guess grandma will be eating cat food now.
Why are they cutting rates if the economy is going strong? It seems this is when they would want to increase them so that they have more wiggle room when things are going poorly.
The Fed is such a clown show!
Yes!!!
Market dropped. I thought it is supposed to go up after a rate cut. So, why did it drop now? The economy is not bad.
“The Art of the Deal.”
5.56mm
“Major U.S. stock exchanges dropped after the decision was announced... “
Down 0.xx% is statistically not a decline or a rise, suggesting the rate cut was expected and already priced in.
I am more or less financially illiterate, relying on my financial advisors over the decades for my retirement strategies. In retrospect, I probably should have had a little more interest in econ 101.
As I am just a few years away now from full retirement, I have been working with said advisor to make necessary adjustments to my retirement strategy in order to maximize my benefits and minimize my taxes as my pensions and SS and retirement funds start to pay out.
Anyway I was at an event last night with one of the financial company speakers and they gave a really good economic history and outlook report with lots of charts showing the various metrics used to measure the health of the economy. I learned a lot.
One of the things I learned was that while high interest rates are generally bad for consumers, and thus the consumer economy, zero interest rates are also bad. According to the financial experts, 2 to 3 percent represents a healthy economy. Reason being if the interest rates are too low, you get close to negative inflation, and if consumers think the car they want to buy will be cheaper in 6 months, they wont buy it today. So to keep the consumer economy booming, you don’t want to have disincentives like that to buying.
I also learned why the left says the recovery stated 10 years ago under Obama. The stats do indeed show that the real downturn was in 2007/2008 due to the housing/loan collapse and that jobs started recovering ever since, but only at a very anemic pace. Trump removing regulation unleashed what was already a recovery. The funny thing was that the Fed held rates at zero for all 8 years with Obama, a sign they were worried the entire time about the health of the economy, and I guess based on the previous paragraph, created a disincentive to recovery.
One of the thoughts as to why Trump wants to head back to zero is because that is where other countries are now, which says how bad their economies are. So there seems to be a tension between having a healthy rate and competing for obtaining investment dollars. But that caused concern with the investor presenting for the reasons stated above.
Oh, if you want the bottom line, they are bullish on the economy and say don’t listen to all the media hype about coming recession. The media needs a crisis so that you will tune in to them, so they can get the ratings and sell ads.
President Trump was correct in 2016:
https://www.realclearpolitics.com/video/2016/09/06/trump_the_fed_keeping_interest_rates_artificially_low_so_the_economy_doesnt_go_down.html
The “race to zero” will not end well.
Another reason the Fed believes the US economy will only grow moderately is because of “trade uncertainties.”
But wait, if China, Germany, France, have weak economies and the USA has a “moderate growth” economy, why would “they” risk a trade war with the USA? China needs to settle the trade deal with the US or it will have serious employment and economic problems that oould result in internal revolution (look at Hong Kong). Europe if they snub their nose at US trade sanctions against Iran, will face serious financial problems for their companies. That in turn will really ruin the EU economy.
So are those countries that the Fed fears will have trade war uncertainty do something that is likely suicidal? I don't think so!
??? Why? If the economy is gang busters why?