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PatriotsReign - question about rates

Discussion in 'Political Discussion' started by STFarmy, Sep 16, 2008.

  1. STFarmy

    STFarmy Rookie

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    Hey PR,
    I see that the Fed decided not to cut the key rate, leaving it at 2%. Do you think this is good? My first instinct was, yes, this is good, as I know that cutting it too much devalues our currency. And it seemed like lately, they cut it a lot to appease the panicky Petes on Wall Street. So I see this as a the Fed MAYBE finally taking a hard line stance against the financial institutions that keep wanting lower rates and bailouts.

    Is this misguided? Is it bad they didn't cut the rates in your opinion?
  2. PatriotsReign

    PatriotsReign On the Roster

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    My opinion is just my opinion, but I agree with you. I think it's a good thing. It appears that (hopefully) the fed is actually going to allow the market to find it's bottom without artificial stimulation...or further stimulation.

    I also agree with your assessment that it is good for the financial industry to be weened off their over-reliance upon the fed and get back to sound business practices that allow for a solid foundation to build upon down the road. We all know now that the we had a house of cards that fell apart when the winds of recession started to blow.

    So, yes, I think it's a good thing, but it's only a start. They need to stop adding to the money supply along with congress. No more bailouts and stimulus packages...that would make me rest easier.
  3. STFarmy

    STFarmy Rookie

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    Alright thanks. I know that you may not be the be-all-end-all of economics, but you're more schooled in it than I. That makes you a good place to start. And that opinion also seems sensible to me. Seems like companies can make whatever poor decisions they feel like if they think momma Fed will bail them out. Hopefully we can get away with that.

    Thanks for the answer.
  4. Run DMC

    Run DMC Rookie

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    #24 Jersey

    No worries, the Fed just continues to supply liquidity(codeword for printing and dumping more funny money into the economy). Interest rates are not as important as keeping the money spigot turned on full blast. Only problem with this is it creates mega-inflation and dilution of our currency. Ever wonder why your dollar is now worth 0.70 euros when it was 1.20 euros 8 years ago? Also, there is your explanation of why gold ran from $275 to $750/oz.? It is because they continue to print more money and flood markets with it. Read my tagline quote from Thomas Jefferson and you will see how this all ends.
    Last edited: Sep 16, 2008
  5. Real World

    Real World Moderator Staff Member

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    Any single decision to increase, or drop rates by a quarter point, is not indicitive of any "hardline" trend the fed might be taking. Moving rates up a quarter percent, or keeping them firm, doesn't mean much. They just pumped another $70 billion in reserves into the market yesterday.
  6. IcyPatriot

    IcyPatriot ------------- PatsFans.com Supporter

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    #87 Jersey

    The idiots forget the story of what happened in Germany when Hitler had the money printing presses running full speed. People needed sacks to carry their money to go and buy food. The more we move forward sometimes the stupider our government gets. History has many of the answers but they don't pay much attention to any of that.
  7. Real World

    Real World Moderator Staff Member

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    The Dollar has been gaining rapidly on the Euro over the last couple of months. It's gained 12% to $1.41. The Europeans are in more dire a situation than we are. If there was a time to flush money into the system, it's when the rest of the world is doing it also. It lessens the competitive hit to our currency.

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