The Federal Reserve raised the nation’s borrowing rate by 0.25% for the fourth time this year, despite months of objections from President Trump.
According to Lucy Bayly, the business editor for NBC News, “President Trump fears higher interest rates will take the steam out of the nation’s booming economy.”
She continues by saying, “As head of the Federal Reserve, [Jay] Powell has found himself uncharacteristically singled out for criticism over the central bank’s handling of interest rates, with Trump saying he ‘maybe regretted nominating Powell to the position.’”
“I have a hot economy going,” President Trump said in October, and “every time we do something great, he raises the interest rates.”
Ms. Bayly feel sthat, “Powell’s challenge at this juncture has been to make it clear that the Fed’s decision was data driven and not due to any deference to the political establishment, which would have risked the central bank’s credibility as an independent agency.”
That’s kind of funny. Why does it seem that “The Fed,” the central bank, only seems concerned about its credibility when there is a Republican president?
During an interview with “Yahoo Finance,” Edward Stringham, an economist, Professor of Economic Innovation at Trinity College and the president of the American Institute of Economic Research, said, “We’ve had artificially low interest rates for years.” The Fed has apparently admitted to this because Mr. Stringham goes on to say that, “The Fed has said that they want to get away from that [artificially low interest rates].”
What does “artificially low interest rates” mean? Why would The Fed be dealing with anything that is “artificial?” I take it to mean that The Fed had lowered the rates, or kept them low, for reasons other than financial and/or economic merit.
In other words, it sounds kind of “swampy” and politically motivated to me.
Well, let’s take a look at the recent history of The Federal Reserve Bank, how they’ve handled the rates, and you decide.
When George W. Bush took office in 2001, the interest rate was at 6%.
By June of 2003 the rate was down to 1% due to a recession, the 9/11 attacks, and a war in The Middle East.
The rate was then back up to 5.25% by June of 2006.
It then was down to 1% again by the end of Bush’s term, mostly due to another recession, the housing crisis, bank failures and the bank bailout.
On December 11, 2007, the rate dropped from 4.5% to 4.25%
January 22, 2008, the rate then plummeted to 3.5%
Only eight day later, on January 30, 2008, the rate went down to 3%
On March 18, 2008, the rate dropped to 2.25%
On April 30, 2008, the rate fell to 2%
On October 8, 2008, it fell to 1.5%
Twenty-one days later, on October 29, 2008, the rate dropped to 1%
After Barack Obama was elected president, on December 16, 2008, the rate went to .25%
Note: .25% is the lowest funds rate possible.
Then, for the following 7 YEARS, or basically most of the “Obama years,” the federal interest rate sat there at .25%! For 7 YEARS!!!
It wasn’t until December of 2015 that they managed to raise the rate to .5%.
The rate stayed at .5% all of 2016 until Donald Trump won the election, at which time the rate immediately went up to .75%.
So, even though all of the “biased, liberal, fake news media” financial “experts” were predicting a stock market crash if Donald Trump won, and all kinds of other economic misfortune, The Federal Reserve felt it was a good time to raise the federal interest rate.
Interesting. Ponder that for a moment.
Then over the next two years of the Trump Presidency, The Fed chooses to raise the rate 6 more times, all the way back to 2.25%!
On March 16, 2017, the rate goes to 1%
On June 15, 2017, we’re up to 1.25%
On December 14, 2017, the rate goes up to 1.5%
On March 22, 2018, it climbs to 1.75
On Jun 14, 2018, 2%
On September 27, 2018, 2.25%
And on December 19, 2018, The Fed raised it another .25 to 2.5%
“The economy continues to punch well above its weight,” said Steve Rick, chief economist at CUNA Mutual Group. “Although trade tensions and tariffs continue to present uncertainty, the economy has been running red-hot for a long time…”
Is that what you call “a long time” Mr. Rick, a little over a year?
It seems these economists and know-it-all eggheads are in quite a hurry to slow our economy down.
Why?
Why was it OK for Americans to sit through all of these down times for close to two decades, but then when we finally turn it around they want to throw down all of these speed bumps?
What do you think? Is it a case of “the swamp’s” willingness to sabotage the country for the sake of their own survival and desire for power?
I’m thinking that is the case, but then again, I’m becoming more and more cynical by the day.
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