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Sep 11 - US Fed ‘boneheads’ should cut interest rates to zero or less – Trump


 


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 1 week ago '15        #1
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Putin~Work  3798 heat pts3798
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Sep 11 - US Fed ‘boneheads’ should cut interest rates to zero or less – Trump
 

 
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US President Donald Trump has urged the Federal Reserve to slash interest rates to zero or less, saying that negative rates could save the government money on its debt.
The USA should always be paying the… lowest rate. No Inflation!

“The Federal Reserve should get our interest rates down to zero, or less, and we should then start to refinance our debt. Interest cost could be brought way down, while at the same time substantially lengthening the term,” Trump tweeted on Wednesday. He then praised the US dollar, calling it “the great currency.”

Trump again lashed out at the Federal Reserve’s chairman, Jay Powell, who’s been his constant whipping boy and has been blamed repeatedly for problems in the US economy.

“It is only the naïveté of Jerome Powell and the Federal Reserve that doesn’t allow us to do what other countries are already doing,” Trump tweeted, while adding a final insult to the Fed, “a once in a lifetime opportunity that we are missing because of “boneheads.”

Trump has repeatedly noted that rates are negative in Germany, Europe’s major economy, and called on the Fed to follow suit on more than one occasion. However, earlier he spoke of merely lowering rates, indicating that he does not want them to go into negative territory.

Prior to that, the US president said he believed he had the authority to fire Powell, despite the fact that the Fed is formally a separate entity from the government, and that Powell’s term as chairman don’t expire until 2022.

Following Trump’s calls, the Fed cut rates for the first time in more than a decade in July. However, Trump has since accused both Powell and the Fed of “letting the market down” by refusing to announce a new “lengthy and aggressive” rate-cutting policy.

Financial markets expect yet another cut next week, according to Reuters. The current benchmark rate is 2.00-2.25%.

Cutting interest rates to zero and below is a move used by central banks to boost economic growth, but it can result in cutting savers’ and banks’ earnings. Trump’s critics have been saying his desire for lower interest rates may be tied to his personal pursuits. For instance, the Washington Post reported last month that, as a real estate developer, Trump could save millions of dollars in interest every year on outstanding loans on his hotels and resorts if the Fed brought rates down.

visit this link https://www.rt.com/busine .. est-rate-zero/
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 1 week ago '18        #2
Baron Davis  131 heat pts131
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Trump sucks
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 1 week ago '18        #3
Lord God  94 heat pts94
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Zero or less? Or less?

So... Pay borrowers for their debt?
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 1 week ago '18        #4
Taco  3 heat pts3
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trump supporters
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Top 10 most propped recently  1 week ago '12        #5
OldBusiness  187 heat pts187
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He cries and cries so much whilst creating the majority of his problems.
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 1 week ago '12        #6
Mickey Bricks  132 heat pts132
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"Stupid" hence forth has a face...
































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 1 week ago '06        #7
J Money B&W  1 heat pts1
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 Lord God said
Zero or less? Or less?

So... Pay borrowers for their debt?
No, so negative interest rates are currently a thing in a few countries, I believe Denmark, Japan, Switzerland maybe Germany? Not entirely sure, but I know the first three have them and a couple others do as well. Basically how it works is, when a bank is lending at a positive interest rate you're paying back your principal + the interest payment obviously, with negative interest rates the borrower actually pays back less than the amount borrowed - in simple terms. This is used to promote lending from the banks who have money on reserves and promote investments to boost the economy. I personally haven't done much research on the topic as it hasn't ever been applied to the U.S. before but this isn't the first time talking about it. At the same time, I don't agree with the president, our inverted yield curve is pointing to a recession. As of today the LIBOR is 1.94% for one month and the U.S. 10 year is 1.75%... for those who don't really understand the LIBOR is the rate at which major banks can lend to each other at, basically our 10 year treasury (long term investment) is less expensive than the short term rate for banks to lend to each other (1.94%) which has been a pretty good indicator of recessions in the past.

edit: So, if we were to have rates at zero or below right now, it would get rid of an important tool that could help when/if a recession comes, when we need to promote investment.

sorry for the long post.


Last edited by J Money B&W; 09-11-2019 at 10:07 PM..
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 1 week ago '19        #8
rnfufbx  3 heat pts3
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stable genius
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 7 days ago '05        #9
yunsta  29 heat pts29
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I’m no trump fan but I think he meant either lower the interest rates to zero or lower from the current rate but who knows for sure



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