I have commented more about the Federal Reserve over the past year than should be necessary in a decade, but the Fed just can't get it right.
Let's hope that the Fed decides to hold rates where they are, which may be a little too low already. There is far too much manipulation in the financial world these days... and none of it has done more than enrich a few self-serving manipulators. We don't need the Fed adding injury to injury. Sure, it's supposed to protect the banking structure. Okay, make sure the banks are following good business practices, not speculating because funds are federally insured and other such nonsense.
Repeat after me: there is no free lunch! Sure, everyone loves to borrow money with 0% interest, but the cost is there somewhere. Pay less interest; pay more for inflation. Charge less interest; charge up inflation [have you noticed the price of petroleum products... and a lot of other things... lately?]. Charge and pay too much interest; shut down the economy.Ultimately, the Fed needs to find a moderate rate and hold it. Then let the economy sort itself out.
Tuesday, March 18, 2008How Low Will It Go?
Friday, March 14, 2008Economics Dumb-0-Dumb
ADDENDUM
Fed cuts rates again and hints at pause
Central bank cuts rates for seventh time since September, but sees less risks of slowdown, suggesting this may be last cut for a while.
4% is the number... rock steady.
..