Posted on 11/22/2021 12:07:19 PM PST by ChicagoConservative27
With President Biden reportedly reappointing Jerome Powell to a second term as Federal Reserve chair and make Lael Brainard as vice chair, he will have an opportunity to meet with them privately. So why am I suggesting Biden should do what no other U.S. president has done and indicate that he wants the Fed to raise rates in an election year?
To be sure, throughout the Fed’s history, the opposite tack has been more common: Presidents Johnson, Nixon and, most recently, Trump all jawboned the Fed to keep interest rates low to support the economy and their reelection prospects. The prime exception is Ronald Reagan. He inherited double-digit inflation and did not stand in the way of short- term interest rates reaching 20 percent during Paul Volcker’s tenure as Fed chair.
(Excerpt) Read more at thehill.com ...
Is it the job of a presidnet to signal ok to the fed?
It is the job of the fed to look for an ok signl from the poresident?
That’s right it’s all he can do to signal for his butt to be wiped and now he’s supposed to understand interest rates? 🤪
US interest rates rising will be a disaster for state and local governments who have run up massive debts using low interest short term instruments.
When that paper rises to the 8% to 20% it should be the number of Democrat jurisdictions filing bankruptcy will be EPIC.
Not to mention the number of idiots in America who’ve financed themselves into endless cycles of debt based on low interest rates. They’re in for a massive reality check when their adjustable rate loans skyrocket on them.
just to give you an idea of where this country is heading, I think Lael Brainard who Biden is appointing as Fed Vice Chair refuses to say whether she’s a capitalist....
Not going to happen - need to quit QE first.
Then there is the debt:
Every 1% interest rate increase would increase the budget by $300B interest/year.
She can smell it.
Biden won’t rise rates. No one wants to. It’s seen as evil now
He’s lucky to signal for a depends change.
the final act of destruction regarding the USA economic system
The Fed will do what the Fed will do regardless of Biden signaling or not. They don’t take orders from the President or Congress.
When that paper rises to the 8% to 20% it should be the number of Democrat jurisdictions filing bankruptcy will be EPIC.
Uh, the rate on existing debt remains the same. It would only be new debt at the higher rate.
It's not up to him. The FOMC decides rates and I suspect we'll see them start to edge up after the first of the year.
I bet they wait till after the midterms
Raising interest rates is the standard response to higher inflation and I can see the Fed start easing them up a bit sooner rather than later. But these economic conditions are not the standard inflationary conditions in that the excess money chasing goods came from government stimulus payments, pent up demand from COVID shutdowns and the whole supply chain fiasco. That's why I don't see a rapid rise. The Fed will inch rates up and then see the results.
There is no stopping the inflation.
You must first stop the out of control spending and borrowing.
No one on either side has the balls to do what needs to be done.
If the Fed raises rates to where they need to go, then the federal budget blows up along with market and the housing market. Real rates need to go to about 15%.
It will recede on its own eventually. Anything the Fed does will be an attempt to speed up the process.
You must first stop the out of control spending and borrowing.
Both have been out of control for decades without excessive inflation.
No one on either side has the balls to do what needs to be done.
Surely not Congress or the President. The Fed will do what they can but they can't stop politicians from making it worse.
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