Role of Public Administration
UE, what would happen to the economy if Trump all of a sudden adopted the Gold Standard? How would it affect interest rates, asset prices etc?
You are absolutely correct! Keep up the good work.
@uneducatedeconomist, you good? Youre always doing videos from your truck at night? Dont you ever go home to the wife and kids? Do you ever do videos from a home office? Just asking for a friend whose concerned about you.
Where can we buy the hoodie??
I Think I Agree . I Was Listening To Dr. Mannarino Say " Interest Rates Will Be Lowering Soon " . I Had To Shake My Head On Hearing That . Although I Do Think " World Central Banks " Will Try Something Before "Deutsche Bank " Crashes . "Deutsche Bank " Sits At 6.37 Euros
The only thing they are about to drop is this big ass bubble they have created???
All spot on, but credit markets are falling apart, and they are desperate…so you never know.
we are at the end of the fiat money cycle, the next step is total destruction of the currency and the rebirth of the new fiat currency. A wise man once said the beatings will continue until morale improves.
Mr robot thanks
I agree…the Fed has put itself in a bigly dilemma
Just watched a Real vision video where they were saying rate cuts and QE were coming 6 to 12 months from now.
The People's Republic of The Future https://youtu.be/taZJblMAuko
Just a thought, what do truly dysfunctional economies really look like? People don't hustle and bustle for no money and no stability. They don't complain. They don't try to start businesses only to fail. They sit down on the curb all day. They dance and play music provided there is no threat of immediate starvation. My only point is this. We are hearing a silent roar of 106 million people and counting disengaging their human capital from our economy.
Dang, treasury rates today – the 1 month interest rate is higher than the 10 year interest rate. I would imagine the incredibly low bond rates are part of the reason interest rates are not rising. At 2.5% fed rate and 2.3ish% bond rate, people are essentially investing in negative yielding bonds at the moment which is tantamount to giving money to the feds. At some point, high enough interest rates would make people flood out of bonds into other asset classes, making them bigger bubbles than they already are which would hasten the start of the recession.
I don't think dropping interest rates would bring asset prices even higher. I believe it would only affect the stock market as it operates in a different reality.
Housing is already coming down and it will not stop even if you can buy at %3 because people simply are too burdened with debt. Historically, we have insanely low rates now. With a 700 credit score and 20% down you can get a 3.6% rate on a 15 year which is insane.
Retail apocalypse is already in play, and we all know how the auto sector is doing. Lowering rates may keep assets plateued for longer, but it certainly won't raise the inflated value further. The stock market however would soar.
Most likely, we will see a rate cut this year.
Just my opinion.
It's very troubling to hear politicians clamor for high inflation which is what a bloated asset market is. In general terms if we want a "good economy" it will require stability. Confidence is built on stability. Good economies are built on confidence. In my opinion we have not had economic stability since the 90s.
Dropping interest rates would be admitting that the economy is bad and may spark a fall after the initial climb in stock market.
Interest rate to the fed is like a countdown clock on a bomb. When you hit zero it is all over….
…#6.. To serve as an integral part of the plunge protection team.. Printing and digitizing money out of thin air, to purchase shares in American companies on days when no one in their right mind would be buying. The worrisome part… Though the taxpayer ultimately gets to fund that, he doesn't get to know how much of our country is then owned by this private entity. Too much control, that won't end well for us.
Fed will go back to zero, has to go back to QE4.
Good call. Albeit that neither the 'money-debt' nor an intention to repay it actually exists, interest due and payable remains very real. On this basis, I believe they simply cannot raise interest rates. There is no longer sufficient 'sweat from the borrower's brow' to cover any consequent increase on this particular liability. I'm getting the word … 'saturation'.
You're right, but this is politics not economics. So all bets are off for a rate cut IMO. The Fed probably would want long term rates (10Y+) to go higher but only the Treasury could make that happen. If the Treasury auctions more bonds than what the market demands, you would see rates go higher then the Fed could raise short term rates without inverting the whole thing.
Interest rates always stall and plateau before recession, see link. Sad our system, in present state, shows when unemployment goes below 4%= recession around corner, millions of layoffs and business closings through no fault of their own, see link. I have been thinking that it is odd, when capitalism and businesses are based on debt and most large purchases are as well ( think of houses, cars, and business loans to start or get materials); they would not be able to operate on a pay as you go system. Why do we hold gov't to a pay as you go system. Why can't gov't invest in jobs, healthcare, infrastructure, education, etc, and when people are working better wage jobs, with better education, healthier and therefore making enough to qualify to pay fed taxes; wouldn't the better, more stable economy pay this back in the long run, with interest.
I do think we are in strange times for monetary policy, but look at Europe and Japan, negative interest rates and government buying up national stocks, QE, and the like, I think we will experience a good deal of the same for a long time before a possible currency collapse, Powell's running a tight ship though and he's not giving an inch until he absolutely has to
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