Zero Interest rate for 2 years

[piasabird]

The Fed just anounced that they will maintain the Prime Lending Rate of Zero for 2 years.

http://news.yahoo.com/fed-keep-interest-rate-near-zero-2-years-182232653.html

Do you think this is a good idea or a bad idea? Is this a sign of a depression? It does not indicate anything good unless you are a banker. I think it will just make an even bigger housing super bubble and crash.

 

[RaistlinZ]

Interest rates are at record low and people still aren't buying. I don't think that will change until the unemployment rate is back down, which won't be for a long while.

 

[Infohawk]

This is a consumer-driven economy. Most consumers are lower-class and middle-class. Lower-class and middle-class Americans have decreasing wages and increasing unemployment. How are they going to sustain any significant economic growth? They can't drive I just don't see what actual growth the cheap money can be invested in.

 

[ProfJohn]

It is an attempt to induce stability into the economy and rates.

They are hoping that businesses will feel secure enough to take a few chances.


Next step would be to muzzle the EPA & NLRB etc etc for 2 years as well as suspend Obamacare taxes for that period too.

Extending tax cuts now for that period would be a good idea too.

 

[Infohawk]

It is an attempt to induce stability into the economy and rates.

They are hoping that businesses will feel secure enough to take a few chances.


Next step would be to muzzle the EPA & NLRB etc etc for 2 years as well as suspend Obamacare taxes for that period too.

Extending tax cuts now for that period would be a good idea too.

OK let's say that is done. What do you think companies are going to hire Americans to do?

 

[shabby]

Dow soared today due to the fed announcement, that's all they care aboot.

 

[JSt0rm]

how dare the fed try and stop the financial apocalypse. What can the tea party do about this?

 

[Fear No Evil]

OK let's say that is done. What do you think companies are going to hire Americans to do?

Shovel ready jobs?

 

[sactoking]

how dare the fed try and stop the financial apocalypse. What can the tea party do about this?

Setting the Fed overnight rate at 0% to "stop the financial apocalypse" is a non-argument: the overnight rate was set at 0% in December 2008 and hasn't moved since and it certainly did not yet "stop the financial apocalypse".

 

[JSt0rm]

Setting the Fed overnight rate at 0% to "stop the financial apocalypse" is a non-argument: the overnight rate was set at 0% in December 2008 and hasn't moved since and it certainly did not yet "stop the financial apocalypse".

ok good. Just so long as we dont piss off the tea party.

 

[frostedflakes]

Mmm yeah gotta keep that consumer spending going at all costs. Don't anyone dare think of saving just consume all you can right now. It's the patriotic thing to do.

 

[bradley]

Equity is being sucked dry while the fox is guarding the middle-class, and all your concern is focused on the tea they drink. I hope some of you can jump as high as asked.

 

[Phokus]

It is an attempt to induce stability into the economy and rates.

They are hoping that businesses will feel secure enough to take a few chances.


Next step would be to muzzle the EPA & NLRB etc etc for 2 years as well as suspend Obamacare taxes for that period too.

Extending tax cuts now for that period would be a good idea too.

Hey PJ, do you want American manufacturers to be able to dump toxic waste into the air and ground and create 'cancer villages' like China does so we can be more competitive? This is not a troll question at all, i'm DEAD SERIOUS, because that's what it would take to be competitive with China.

http://www.guardian.co.uk/environment/2010/jun/07/china-cancer-villages-industrial-pollution

 

[GTaudiophile]

Yay. Two more years of earning nothing on savings!

 

[Jhhnn]

This is what's known as a liquidity trap, children, in which monetary policy is almost neutered. Read about how the NYFRB carries on about how they're not really powerless, but rather can't do jack shit-

http://www.newyorkfed.org/research/economists/eggertsson/palgrave.pdf

Just another one of those tricky debt/deflation things that follow right on the heels of an enormous financial bubble, like the Ownership Society.

What? Y'all thought this would just go away if we carried on about the federal budget? Silly children.

The same nice people who suckered you with easy credit are now going to give you an economic ass-whupping, and you'll believe 'em when they tell you that you deserve it.

 

[theeedude]

I think everyone was pretty much expecting this anyways. It's not like unemployment is going to be 5% in 2 years. Doesn't really matter. Companies are sitting on tonnes of cash already, and not spending. The government needs to step up and start hiring.

 

[Svnla]

ok good. Just so long as we dont piss off the tea party.

The mess we are in right now were created by both parties for years. I don't remember Tea Party was ever in charge before.

<<--- not D, not R, not T, not anything, just American.

Yay. Two more years of earning nothing on savings!

You could earn around 3 to 4&#37; from Reward Checking accounts. I know you have to jump several hoops (debit card usage, direct deposit, etc.) to get those rates but it is better than savings and CD accounts.

 

[BarneyFife]

LOL. How stupid are Republicans in here. You guys make shit wages and think you relate to the industrialists that are worth billions.

 

[nobodyknows]

I wonde if I can borrow some money on my house at 0&#37;?

 

[EagleKeeper]

I think everyone was pretty much expecting this anyways. It's not like unemployment is going to be 5% in 2 years. Doesn't really matter. Companies are sitting on tonnes of cash already, and not spending. The government needs to step up and start hiring.

And who is going to pay for it?

 

[matt0611]

I think its a great idea.

We obviously need soviet style central planning of our interest rates.
We wouldn't want prices to be set by the market, our commissars know what the prices should be, its all good.

 

[alphatarget1]

You could earn around 3 to 4% from Reward Checking accounts. I know you have to jump several hoops (debit card usage, direct deposit, etc.) to get those rates but it is better than savings and CD accounts.

Reward checking account interest rates are going down too.

 

[Macamus Prime]

Armchair millionares/billionares are plentiful on these forums.

 

[Raghu]

Send your money to India!! 10&#37; per annum interest rates ftw!

 

[QuantumPion]

Hey PJ, do you want American manufacturers to be able to dump toxic waste into the air and ground and create 'cancer villages' like China does so we can be more competitive? This is not a troll question at all, i'm DEAD SERIOUS, because that's what it would take to be competitive with China.http://www.guardian.co.uk/environment/2010/jun/07/china-cancer-villages-industrial-pollution

Stop being such a baby.