That bit about the POTUS not influencing the Fed is a bit of BS. Trump maybe is the first to be so publicly vocal, but if say the Fed decided to ratchet rates up 4% under Obama, do they really believe Obama would have stayed out of it?
It would be better news if they had simply left interest rates alone in the autumn of last year. But they had a mid term election they just had to influence.
Here is the first paragraph from the StarTribune:
“ The Federal Reserve cut its key interest rate Wednesday for the first time in a decade to try to counter threats ranging from uncertainties caused by President Donald Trump’s trade wars to chronically low inflation and a dim global outlook”
Then again I can remember the neighborhood bank paying 4 % on a passbook savings account.
Great news for homeowners. You can refinance your house to a lower interest rate. We usually refi every time 1.0% or more is lower due to closing costs. I.e. We are at 3.875% now and will refi again at 2.875% if it gets that low.
A race to the bottom is how the WSJ opinion page editors call it.
Inflation is low, not high, so IT - inflation - is not creating any bubbles, so the Fed is going to try to create one itself.
https://www.wsj.com/articles/the-race-to-the-bottom-standard-11564529532
Foolish.
rwood
I am a little confused. The rate was cut but the market dropped 300 points at the time of this post.. What ? what? I thought this was supposed to be good news.
This is the first time we've had a non-politician as President. IMHO, working out wonderfully so far.
God please bless President Trump, his family and advisers.
They just had to throw in the “stave off recession” bit. I’m really not sure why they even did it except if the administration was pushing for it. Dare I say, to pay some favor? Rates are low enough, they just don’t need to go back up too soon and certainly not in an election year.
With federal spending ballooning, I suppose there is no way the rates can be increased anymore.... despite the deep state wishes to have a high dollar value salary...
Trump could order the treasury to coin a 1 trillion dollar coin and give it to the fed. That should lower the dollars value a little.
No, it’s not. All this is doing is trying to keep the Wall Street bubble inflated. Money printing is dangerous and always ends badly. We used to understand this back when the Democrats were in power. For some reason conservatives have been stricken with a bad case of amnesia and affinity for Keynesian economics.
Buy gold.
The Interest Payments on the National Debt eat up nearly $500,000,000,000 every Year, and that is with Historically Low Interest Rates now in effect.
Overnight a quarter of the Federal Budget could be gobbled up just servicing the Debt.
Imagine when, not if Interest Rates get back to reality.
I remember all those 10% CD Rates being offered way back when. The Mortgage Rate on my very first House was 9% back in the 1970’s. Think that can’t happen again?