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Since the year 2000 every time the Fed has begun rate cuts, the economy was just about to start a recession. The cuts were very fast after the first one in each
by nemo44x 2y ago
Since the year 2000 every time the Fed has begun rate cuts, the economy was just about to start a recession. The cuts were very fast after the first one in each of these cases. I guess it might be a really good time to start buying bonds if you expect this pattern to continue. This is the 4th time they have begun rate cuts after a time of raising rates since 2000.
- AbstractH24 2y agoSo you are saying something certainty based on a sample size of 3?
- nemo44x 2y agoThere have only been 3 events over the last 25 years. But that's a pretty long time to draw a conclusion from. The Fed isn't random - they see things and make decisions based on them. Every time we have faced a recession they lowered rates. I'm guessing if you go back further than 25 years you'll see a similar pattern but I haven't looked.
- candiddevmike 2y agoThe inconvenient truth is our economy/way of life doesn't work with high interest rates anymore. Everything is over-leveraged and the future has been loaned out 1000 times over. Interest rates can't stay above inflation or the house of cards falls over. Raising interest rates was never really the fix to begin with IMO (and the fed admitted as much too), more taxes were, especially at the top end. But congress can't be bothered to do that, so the fed had to act with the tools it had available.