Friday, April 28, 2017

Interest rate

The lower interest rate saves the stock market. There is no double-edge sword. There are many long-term problems:

1. While the rich benefit (stock market...), the poor are not. The retirees depending on fixed income suffer.

2. The next generation(s) suffer as they have to pay back our record national debt.

3. The long term economy will suffer as we will have to service our debts.

4. Suppose to have a super inflation (not now) as more money chasing the same commodity.

The Fed's job is to balance inflation / deflation and stimulating/controlling a overheated market by adjusting the interest rate regardless what the president wants. It is set up as an independent government agency with no boss. In reality it is not. The above 4 points are written down in my first sip of coffee.


The chief task of the Federal Reserve Bank beside printing, distributing money, fed fund is adjust the interest rate. A computer program can do the job nicely
Is the chairman/chairwoman a puppet of the president or vice versa?

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