High or low interest rates.

Re: This has nothing to do with machining or grinding so delete it if you wish

QT a news article:
Specifically, the Fed’s boosting of the economy by keeping interest rates low disproportionately helps rich people and thereby actually disadvantages those in need.

I think this article is just dumb.
Low interest rates make home and car buying easier.
The stock market goes up so 401Ks are better off.
Just these two things make low-interest rates better for working people.

Poor people suffer from the very same reasons and because they don't have much money in the bank make little interest.

Article; How the Federal Reserve can really help America

This is more fake news, daily news post it often enough and people will be hoping for high interest rates.

In 1981 it (interest rate) reached its highest point — 18.87
*How would you like to go to a federal reserve bank and borrow USA money (our money) and pay 15%.

I know.. I double posted the s thread and don't know how to delete that other one. So only reply on this one and the other might go away.

Triple post!

Homebrewblob said:

Triple post!

Click to expand...

Yes, I saw that-> Triple post!...DARN

And I'm only drinking coffee.
Likely I will get fired..at least reprimanded.. or dirty looks from the boss.. someone might throw a raw egg on my car.. grease my handles, hammer tap the back of my Blanchard with a fully loaded chuck of small parts.. Hang a fake pop-out rat in my toolbox..put a live worm in my coffee when it went almost cold.

michiganbuck said:

, hammer tap the back of my Blanchard with a fully loaded chuck of small parts...

Click to expand...

That will certainly wake you up.... (guilty as charged)
If inflation continues on it's current trend what will the Fed do? What can they do? Is it time to nail the brakes?
Hopefully some lessons were learned in the late 70's, 80's. This a time when I wanted to buy a house and had a decent income.
Bob

Replying on only one thread.

I was under the impression that national banks try to keep inflation at about 2% to keep economies moving steadily and avoid high inflation (bad) or deflation (disastrous). Currently, annual inflation rates appear to be rising very sharply, but part of that must be because they are calculated as the difference between now, when things are starting to get back to normal and last year, when things were shut down. So the underlying rate of inflation is still fairly low and the national banks are giving very low interest rates to encourage people to spend, rather than save.

Since interest rates were already so low that lowering them more is difficult, the national banks have been employing 'quantitative easing', by which they buy (mostly) their government's bonds from banks and pension funds, which pushes up the value of those bonds and simultaneously reduces their implied interest rate. This releases money, which the funds, banks etc. use to buy stocks. This pushes up the stock markets and , hopefully encourages people to sell the stocks for money that they can spend. Apparently it works.

Takeaway, I suspect that the current rate of inflation (UK+US+everyone else except maybe Japan!) is a temporary blip cuased by using an annual figure and comparing now with a lousy previous year.

I'm not an economist, nor have I played the part of one on the television.

And much of inflation may be caused because of reduced manufacturing/short supply due to covid and artificial pay/pay with mo product.