I highly recommend reading the whole series I linked from the first post. If you cant read all of it, at least read the first 3. It gives you the basics necessary to understand how the Fed backed financial system really works.
Why is a fed cut going to affect that either way.
In short, fed rate cut = Printing more money = money loses value = more inflation.
There was a pause to this with the rate raises, but that caused the economy to stagnate. They are now at end game point - stuck between a rock and a hardplace.
Keep the rates higher and tank the enemy just before elections.
Lower the rates and shoot the economy to hyper-inflation causing dollar to lose value and financial system to collapse.
From that day on the Titanic, this has been inevitable reality. They could just keep pushing the end so far, but we have reached the end.
You found this place for a reason. If you think know everything and the world makes sense exactly as you have been taught, then this place is useless for you.
I am not a financial expert as may shortly become apparent but I see it like this.
Imagine if your country is actually a savings bank. When you drop the interest rate people will move their money from your bank to another one with a better rate.
So, when the Fed lowers the interest rate the country will lose money because it will be moved elsewhere.
Why is a fed cut going to affect that either way.
I highly recommend reading the whole series I linked from the first post. If you cant read all of it, at least read the first 3. It gives you the basics necessary to understand how the Fed backed financial system really works.
In short, fed rate cut = Printing more money = money loses value = more inflation.
There was a pause to this with the rate raises, but that caused the economy to stagnate. They are now at end game point - stuck between a rock and a hardplace.
Keep the rates higher and tank the enemy just before elections.
Lower the rates and shoot the economy to hyper-inflation causing dollar to lose value and financial system to collapse.
From that day on the Titanic, this has been inevitable reality. They could just keep pushing the end so far, but we have reached the end.
This is not true.
You found this place for a reason. If you think know everything and the world makes sense exactly as you have been taught, then this place is useless for you.
I am not a financial expert as may shortly become apparent but I see it like this.
Imagine if your country is actually a savings bank. When you drop the interest rate people will move their money from your bank to another one with a better rate.
So, when the Fed lowers the interest rate the country will lose money because it will be moved elsewhere.
Then what is the truth? Tell us the net effect this will have on the flow of $ and the economy. Obviously you know.