From here: Fed faces tougher task in deciding whether to cut U.S. rates - excerpt: Besides, the economy is humming along just fine with one of the lowest unemployment rates in over a decade. Lowing rates will only boost Consumption, which will set-of an inflation. Which, in turn, will reduce Consumption and, if continued further, spark layoffs and thus unemployment. MY POINT: Leave the economy as it is. Let's focus on the Real Problem, Income Disparity. Which is quite definitely the largest problem facing America today. Because it is directly pertinent to How We Live As A Nation of People! Meaning what? This: For those who don't know what the Poverty Threshold is (from here): So, of course, there are different income-thresholds for different family-sizes, which seems perfectly logical. For a family of four (ie, two children) the rate is around $25K of income annually. More importantly, however is this question: What is the population living below the Poverty Threshold today? From here: Forty-seven million people is about the combined population-size of the states of California and Massachusetts. Any one who thinks that such is not a Major Societal Problem for America must be living on some other planet ... !
I don't see how poverty has anything to do with the Fed cutting rates. If you think poverty can be addressed with lower interest rates, you are deluded. (Not trying to make a personal attack right there) That's going to be terrible policy if we are relying on the Fed (Federal Reserve Bank) to address poverty/inequality. Isn't the Fed just supposed to be focused on trying to help, in certain ways, promote economic stability, in the general economy overall?
New York (CNN Business)The Federal Reserve is preparing to rescue the American economy from President Donald Trump's trade war. Fearing a recession and soft inflation, the US central bank has signaled it will cushion the blowfrom tariffs by lowering interest rates. But there remains a deep divide over the wisdom and merits of this rescue effort. Some believe the Fed is taking out prudent insurance designed to prevent a deflationary spiral and extend the economic recovery long enough to normalize policy. "It's very important this expansion continue as long as possible," Fed chief Jerome Powell told lawmakers on Thursday as he strongly hinted at rate cuts. Others point to historically low unemployment and the Dow cruising above 27,000 as evidence that the Fed is making a major blunder. Unnecessary rate cuts risk blowing yet another asset bubble, overheating the economy and leaving the Fed with little ammo to fight an actual recession. https://www.cnn.com/2019/07/12/business/fed-powell-rate-hikes-economy-recession/index.html All at the request of Trump: President Donald Trump lambasted the Federal Reserve yet again on Friday, saying he thinks the economy will “be breaking records” even though the central bank has rates set too high. “If we had a Fed that would lower interest rates, we’d be like a rocket ship. But we’re paying a lot of interest and it’s unnecessary but we don’t have a Fed that knows what they’re doing so it’s one of those little things,” Trump said. “But if we had a Fed that would lower rates, we would have a rocket ship.” https://www.cnbc.com/2019/07/05/tru...interest-rates-wed-be-like-a-rocket-ship.html Famous last words..
Why do we hear this trumpeted around that the Federal Reserve has the power to "rescue the American economy"? Why do people even think that? Is that just more ideological belief in big government? Maybe people don't fully understand what the Federal Reserve is, and attribute to it powers over the economy it does not actually have? Do these people actually understand what the Fed can and cannot do? They are hoping for a rescuer, but the Fed may not be the rescuer who can help them. Or at least the type of policies the Fed generally pursues may not be the type of policies that address the problems they are concerned about. All this talk about the Fed "saving the economy" is kind of overblown. They probably can't really do that. Just fanciful imagination.
Who is "you people"? Do you have problems discerning who is the messenger and who puts out the message?
https://www.usatoday.com/story/mone...eral-reserve-lower-interest-rates/3629310002/ Better tell that boy president of ours then about how the Fed has zero influence or power over the economy.
Perhaps I should have been more succinct. The Fed lowering rates will help keep the economy booming - and the poor more employed. Until it busts, that is. (Which happens to any economy as frenzied* as that of the US.) What I am getting at is that only Educating The Poor will diminish their numbers. And that has to be free, gratis and for nothing - since they haven't the means to pay for post-secondary education at even state-schools ... *Psychology has one helluva lotta impact on both buying-and-not-buying consumer sentiment.
I didn't get that message at all in your opening post. It's also a separate issue which I overall disagree with, but since you didn't outline it in your opening post, I believe it would be unfair to debate it in this thread.
I assume if you share a message, and don't disagree with it, you are agreeing with the message. A reasonable assumption for anyone to make.
I didn't say zero; but many people (or at least media articles) seem to overestimate it. Anyway, the type of influence the Fed wields is typically not the type of tools one would optimally want to enact certain economic-related public policies. Just saying we shouldn't automatically look to the Fed for economic policies, it depends what type of economic issues they are.
That seems to have been their strategy during the last Recession. Amazing that Progressives still cheer on the Fed.
It would be one thing if they were at least advocating careful spending of the money they want to spend, but that doesn't seem to be the case, it's like they're looking for any excuse to spend. The Fed spending money is not the most cost effective expenditure of money (especially for the goals they have in mind), but it seems like they don't care. They'd burn two dollars of taxpayer money just to get the other dollar.
