Why would you cut rates when there’s high inflation? They should be raising rates until it is gone.
To hell with politics - do what’s best for the country!
Silly me, I look at it this simple way.
What is inflation doing? And I don’t mean us the GROWTH slowing. I mean, is it shrinking?
If yes- lower away.
If no- raise or maintain.
Seems to me that if they lower rates, inflation will run amok.
Go for it - every investment I have will rise in share price back to where to was
Stagflation. Welcome Back, Carter.
The FED has tipped the scales in favor of the Democrats before (like in 2018).
Like the Fed? Nothing “federal” about it. They take OUR money and “lend” it back to us at an interest rate they determine. Billionaire thieves.
Dumb article.
A rate cut is guaranteed .
The economy has one foot on a banana peel and Friday made that clear .
The question is how much will they cut and how many more cuts are coming .
You cut when it’s time to cut, you raise when it’s time to raise. The FED has been pointing at Sept for months, check the dot plots. There is no mention of elections in the FED’s mandate of operation.
it appears that government measured inflation has been steady at about 3% for about a year (i know, there is a difference between government inflation and reality, but these are DC and NYC policy makers, so some deference must be made to their reality versus the real world).
SP 500 and DJI have declined since july 16. SP500 by 7.5%, DJI by about 3%. The trend (imho) seems likely to continue for the medium term future if no intervention.
the measured inflation is much less than carter era inflation (roughly 20%) in the late 1970s. That era could be viewed as the maximum that Democrats are willing to go.
If the premise is accepted that the central banks largely control politics excluding trump, and want trump gone, then it seems logical that the fed would somehow decide that its policy (always shrouded in voodoo economics magic) would suddenly decide that a change of policy was needed because (invent silly economist supplied reason here). the new policy of choice would be everyone’s familiar old friend, QE.
What are we up to now, QE5 (in 2019?)? so the new QE could be QE6? alternatively, they could come up with a new name for the old medicine. Anyways, printing fiat money and lots of it, starting this month so as to give some time for the money to percolate through the system and have a positive effect on the stock market.
typically, it takes only a few days for the stock market to recover. the fanfare tends to drown out other less flattering economic news. if good news is required in october for a november election, then the QE injection must occur between now (august) and next month (september) so as to ensure favorable monthly stats and headlines for biden ... woops, michelle... woops, kamala in october.
so for democrats to win in november they need a fed change in direction, come hell or high water, just about now.
and anyways, math-wise, imho we don’t have much of a choice than to print more money.
https://www.youtube.com/watch?v=Nzo6DMuZkOo
(and of course i could be totally wrong...)
:-(
the Fed can cut between meetings -
The best course of action is allowing the market to set interest rates.
A free market has a way of pricing things correctly.
Rates should go up, not down.
Alas, the Fed will most certainly pander to the global left.
And burn the world down with inflation.
It’s called STAGFLATION. Here comes Harris to the rescue because it’s Trump’s fault!
” For a central bank that judiciously aspires to stay above the fray of partisan politics...”
🤣😂🤣😂🤣
Yeah. Right.
“The Fed should not try to control demand in the economy and interfere with free markets by playing with the Fed Funds overnight loan rate and George W Bush changed the law to say they could not do this anymore. The Fed is supposed to unwind its balance sheet to tighten, not mess with interest rates, which are not just high…..they are way too high. If you look at the CPI, PPI and core inflation, and are realistic in understanding the Fed cannot control certain prices and shouldn’t try——if you understand how destructive recessions are socially and politically and economically……then the Fed not only should cut, they should cut their Funds rate deeply, to 3% or under. Big Business is doing great now, but small business and banks are getting killed. Inflation is NOT going to get out of control if we let markets work. The economy cannot grow fast unless the Fed accommodates fast growth. People have not gotten raises since 2019, but prices are up on most things they buy. Since Volcker, the Fed has increasingly divided the country by allowing prices to rise when the economy is bad, but now allowing wages to rise when the economy is good—-which is a misinterpretation of its “dual mandate” to prevent recessions, which do NOT reduce inflation at all, but just begin a new cycle of inflation that leaves the middle class out of jobs and working wages and salaries. People who claim the Fed should keep rates high or raise them higher do not believe in free markets at all. They believe the Fed should take the side of buyers of labor over sellers of labor & interfere with the workings of the free market”.
If deficits cause inflation, it must be true that recessions with rising unemployment rates and spending make deficits worse. That’s why the Fed policy is so wrong to play with interest rates and attack inflation when deficits are smallest during booms.
Let the Fed cut rates. Trump can immediately go on the attack, on two grounds: first, that if the economy was strong, it wouldn’t need a rate cut; second, the fact that inflation is still high, shows that the Fed is playing politics, because, cuts and inflation don’t go together very well. He gets a two-fee, slamming both the current administration and the Fed on economic grounds, where he is at his biggest advantage.
Congress created the massive inflation that they can solve by cutting back the spending. The FED says we need to punish the public with higher interest rates.