Remember the reasoning behind increasing interest rates reduces inflation, is that it makes it harder for companies to get loans and keep people employed.
Literally, the fed increasing rates means they want to make more people unemployed, because they think inflation is caused by workers having too spending too much of their expendable income.
This is flawed logic in a K shaped economy, or an economy that is under pressure due to a lack of goods because of war and tariffs.
Rasing the interest rates, will not help reduce inflation rates or help the fed meet their 2% goal. This will only hurt workers, and increase federal debt.
There needs to be a plan to address the actual issues that are causing inflation.
Like I explained elsewhere in this thread, the economy running a little too hot is the normal case for raising interest rates to slow down the economy.
When an orangutan is using a ouija board, it seems, to make decisions about the global stability and the economy, this strategy of raising interest rates to deal with fundamentally poor decision-making may not be as effective.
Remember the reasoning behind increasing interest rates reduces inflation, is that it makes it harder for companies to get loans and keep people employed.
Literally, the fed increasing rates means they want to make more people unemployed, because they think inflation is caused by workers having too spending too much of their expendable income.
This is flawed logic in a K shaped economy, or an economy that is under pressure due to a lack of goods because of war and tariffs.
Rasing the interest rates, will not help reduce inflation rates or help the fed meet their 2% goal. This will only hurt workers, and increase federal debt.
There needs to be a plan to address the actual issues that are causing inflation.
Like I explained elsewhere in this thread, the economy running a little too hot is the normal case for raising interest rates to slow down the economy.
When an orangutan is using a ouija board, it seems, to make decisions about the global stability and the economy, this strategy of raising interest rates to deal with fundamentally poor decision-making may not be as effective.
I’m just trying to explain it in simple terms.
I almost never hear economists explain why rasing rates is supposed to lower inflation. Or why it’s the only tool used to try to combat inflation.
Every rate increase is a hope that people lose jobs. And it simply isn’t going to resolve our issues.
Because other options to combat inflation like reducing tariffs, better trade deals and higher taxes are off the table politically in the media.