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re: Why the hell is the Fed thinking about lowering interest rates?
Posted on 8/2/24 at 2:49 pm to cbree88
Posted on 8/2/24 at 2:49 pm to cbree88
The danger is overshooting on interest rates and crashing the economy. Keep them too high when you don't need to and suddenly you have a recession on your hands. Like if you take a gummy and don't feel anything, so you take another one and suddenly they both kick in.
1
Posted on 8/2/24 at 2:50 pm to jizzle6609
quote:
People are broke.
I'm not.
Posted on 8/2/24 at 2:51 pm to TBoy
quote:
Did you speak out when Trump was beating up the Fed, demanding lower rates when they were already historically low?
We should have spoken out against it. Trump created some of the inflation that followed his presidency through his excessive spending and his bullying the Fed into keeping rates too low.
This is not entirely Joe Biden’s fault.
Posted on 8/2/24 at 2:51 pm to LSURussian
quote:
quote:
Why the hell is the Fed thinking about lowering interest rates?
quote:
they want to raise the rates and cause the inflation to come back
So which is it?
The main reason the Fed raises interest rates is to get inflation under control. They will keep raising until they do. This is the improper time to lower the rates as inflation is over 3% for the first half year. It is not fully under control
yet.
Posted on 8/2/24 at 2:52 pm to cbree88
quote:
No they aren’t. People are still spending
This is what baffles me. You can spend and be broke guy.
But ok.
Posted on 8/2/24 at 2:52 pm to cbree88
Because unemployment is skyrocketing
And they went to far
And they went to far
Posted on 8/2/24 at 2:53 pm to cbree88
The price would go down significantly if people stopped being willing to pay that much for them. Nobody is willing to do without top of the line stuff and love simply today.
This doesn't happen overnight.
You'll never discourage excessive spending, that's how most people live.
What needs to happen is you follow through with the punishment when they get in trouble and stop bail outs.
Posted on 8/2/24 at 2:54 pm to SDVTiger
quote:
unemployment is skyrocketing
4.3%......c'mon man
Posted on 8/2/24 at 2:55 pm to Cdawg
quote:
I'm not.
Recessions are fun if you arent broke.
Posted on 8/2/24 at 2:55 pm to Bayou_Tiger_225
quote:
quote:
Poli board? The OT isn't capable of discussing monetary policy and inflation? We all spend money.
whether you like it or not they are linked.
Tangible results of the Biden administration’s inflation plan would be the Fed feeling comfortable enough to lower rates. It’s an election year, and there is pressure from the Biden administration to lower rates so that they can say their plan worked.
And this isn’t just a democrat thing. Trump put pressure on the fed to keep rates low so that the economy would keep running red hot.
There was not runaway inflation when Trump was President which is why interest rates were low. Inflation since Biden was elected is cumulatively over 20%. Regardless of the political affiliation, interest rates are always increased to rein in nflation.
Posted on 8/2/24 at 2:56 pm to SDVTiger
quote:
Because unemployment is skyrocketing
Posted on 8/2/24 at 2:57 pm to TBoy
quote:
Did you speak out when Trump was beating up the Fed, demanding lower rates when they were already historically low?
maybe my eyes dont see too well, but i dont remember paying $6 for a dozen eggs when trump had the rates down to 3%.
Posted on 8/2/24 at 2:58 pm to TBoy
quote:
If the Fed has determined that inflation is under control, they should lower rates incrementally. This isn’t a random idea.
You are correct; however, inflation is not under control. The CPI on all items through the first six months of the year is 3.74%. That is higher inflation than the annual total for 2023. Inflation IS NOT under control.
Posted on 8/2/24 at 2:59 pm to Tmcgin
quote:
4.3%
Well the said over 4.2 and they cut. Its screamed up the last 6mnths
Sorry that upsets you
Posted on 8/2/24 at 3:00 pm to cbree88
Because the instant effect will be a false sense of security on the economic front, but by next Spring inflation will be higher than Giraffe Pussy. Meanwhile people,will have already voted in Nov.
Posted on 8/2/24 at 3:00 pm to cbree88
quote:
No they aren’t. People are still spending, spending, and spending like there’s no tomorrow. That’s why car dealerships can get away with selling Tahoes and trucks for $80,000.00.
The price would go down significantly if people stopped being willing to pay that much for them. Nobody is willing to do without top of the line stuff and love simply today
A lot of those people will go bankrupt when we have an economic downturn.
Credit card and auto loan delinquencies are at their highest levels in a decade.
Posted on 8/2/24 at 3:05 pm to lynxcat
quote:
It’s a 0.25 to half a point. You are acting like zero rate environment is being proposed.
That's the usual amount when they raise or lower so as not to shock the system. But what's more important is what it signals to the market.
Answer the question...how could they possibly lower in a still hot inflationary market?
Only answer that seems to make any sense is that the administration has decided that inflation in an expanding economy is more important to them in an election year than reining in inflation and taking the pain off the middle class (who pays the biggest price with inflation).
This post was edited on 8/2/24 at 3:06 pm
Posted on 8/2/24 at 3:05 pm to cbree88
Election year…..
Posted on 8/2/24 at 3:13 pm to Bayou_Tiger_225
quote:
And this isn’t just a democrat thing. Trump put pressure on the fed to keep rates low so that the economy would keep running red hot.
Except inflation wasn't running hot when Trump was in office. Just need to look at the money supply to understand why. Turns out Milton Friedman was a smart guy.
Milton speaks about the inflation in Japan in the 70s.
LINK
ETA: You can see the interest rate hikes are helping reduce the money supply, but as Milton explains in that video feeling the good effects of high rates shrinking the supply doesn't come immediately. First there is the pain.
This post was edited on 8/2/24 at 3:17 pm
Posted on 8/2/24 at 3:14 pm to cbree88
quote:
No they aren’t. People are still spending, spending, and spending like there’s no tomorrow. That’s why car dealerships can get away with selling Tahoes and trucks for $80,000.00.
A guy with zero cash who commits financial suicide by getting a $80K car note with zero down is 100% broke, baw.
quote:
Interest rates need to go higher because apparently we haven’t discouraged excessive spending yet.
Well, you’ll definitely kill spending because sending rates higher is going to put a lot of people out of work.
This post was edited on 8/2/24 at 3:18 pm
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