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Currently the Federal Reserve is attempting to reduce demand for goods and services by raising interest rates dramatically. Reducing taxes increases demand and

Currently the Federal Reserve is attempting to reduce demand for goods and services by raising interest rates dramatically. Reducing taxes increases demand and works against the Federal Reserve here. The US needs a credible tax policy otherwise no one will buy Federal Government Debt. How does the government source money? Via taxes or new debt issuances. Without sufficient taxes you cannot issue more government debt. UK just had this issue, EU looks like it’s next. Maybe even the USD after that.

slaw 4y ago
Where exactly do you see dramatic interest rate increase? Are you referring to these tiny .75% increases? We have 3-3.25% interest rate with 9% inflation.
- thoughtstheseus 4y ago
  The Fed Funds rate was 0.25% one year ago, now it 3.25% or >10x higher…
  - Red_Leaves_Flyy 4y ago
    0.25% was never sustainable and everyone not on the take was sending the alarm in the teens . Had the fed taken the bandaid off faster following 08 they would have had the tools to support the economy without needing to pump trillions of dollars in during COVID. Now the Fed’s in a corner and if they don’t continue squeezing we’ll see 40% inflation in no time, if they do we’ll see mass suffering in 50-90% off the population. Perhaps a retroactive excess profits tax, land value tax, meaningful inheritance tax, nationalization of healthcare, mobilization of a CCC to build infrastructure/provide jobs, and massive housing build out, could ease the suffering. Alas, each of these individually are helpful enough to the common human as to be non negotiable for the half of Congress committed only to themselves and their puppeteers.
    - slaw 4y ago
      Fed quickly pumped trillions of dollars to stock market, because it is good for the wealthy. Keeping interest rate above inflation is good for common people so it is not as important.

slaw 4y ago

Where exactly do you see dramatic interest rate increase? Are you referring to these tiny .75% increases? We have 3-3.25% interest rate with 9% inflation.

thoughtstheseus 4y ago
The Fed Funds rate was 0.25% one year ago, now it 3.25% or >10x higher…
- Red_Leaves_Flyy 4y ago
  0.25% was never sustainable and everyone not on the take was sending the alarm in the teens . Had the fed taken the bandaid off faster following 08 they would have had the tools to support the economy without needing to pump trillions of dollars in during COVID. Now the Fed’s in a corner and if they don’t continue squeezing we’ll see 40% inflation in no time, if they do we’ll see mass suffering in 50-90% off the population. Perhaps a retroactive excess profits tax, land value tax, meaningful inheritance tax, nationalization of healthcare, mobilization of a CCC to build infrastructure/provide jobs, and massive housing build out, could ease the suffering. Alas, each of these individually are helpful enough to the common human as to be non negotiable for the half of Congress committed only to themselves and their puppeteers.
  - slaw 4y ago
    Fed quickly pumped trillions of dollars to stock market, because it is good for the wealthy. Keeping interest rate above inflation is good for common people so it is not as important.