I have a legitimate question this evening. Why doesn’t public enemy #1 want to lower interest rates?

I mean, if it’s good for the economy (per Trump) why doesn’t he just do it?

And how low can the Feds lower the interest rates? Is 1% a good thing?

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Th1nkF1rst · 70-79, M

1% is great for a borrower,
But investment income @1% is really really sad for the economy!

QuixoticSoul · 41-45, M

@Th1nkF1rst Something about this seems off, those things aren’t exactly related to each other.

Th1nkF1rst · 70-79, M

@QuixoticSoul Yes they are!

Don't dispute me!
You have no idea how I think!

QuixoticSoul · 41-45, M

@Th1nkF1rst No I don’t 🤷‍♂️

How does the Fed lowering interest rate lower investment income?

whowasthatmaskedman · 70-79, M

@Th1nkF1rst And when rates are that low, be VERY careful what you borrow for. Bad times are very likely to follow.

Th1nkF1rst · 70-79, M

@QuixoticSoul Bonds!

whowasthatmaskedman · 70-79, M

@Th1nkF1rst The reverse curve in those points to trouble ahead as well. The yield is lower in the lower term.

Th1nkF1rst · 70-79, M

@whowasthatmaskedman And greedy people will borrow at 1% and hold it till inflation brings about 17% and they lend it out at 16⅝ to 1st time home buyers!

whowasthatmaskedman · 70-79, M

@Th1nkF1rst Yeah.......Nah.. The world economy is changing from the old model. Those days may come again. But maybe not for a century.

graywanderer · 46-50, M

@Th1nkF1rst Remember when we used to get 6% of saving accounts?

Th1nkF1rst · 70-79, M

@graywanderer yes ...
But credit card rates were 21.89%

graywanderer · 46-50, M

@Th1nkF1rst Credit card rates are already that a high (at least per the last advertisement I got).

QuixoticSoul · 41-45, M

@Th1nkF1rst That relationship is pretty funky tbh.

In general, bond funds tend to do well when interest rates decline because the securities already in the fund's portfolio likely carry higher coupon rates than newly issued bonds, and thus increase in value. ... If interest rates drop and older bonds begin trading at a premium, the NAV may jump significantly.

whowasthatmaskedman · 70-79, M

@graywanderer Credit cards are a real trap if you dont pay therm on time EVERY time.

graywanderer · 46-50, M

@whowasthatmaskedman I think I've only held a balance two months in my life. Both times were on accident.

Th1nkF1rst · 70-79, M

@graywanderer
That's why I have all my Investable Money
tied up in BEANIE BABIES &
COLLECTABLE CERAMIC LIQUOR BOTTLES!

I'm gonna make a killing on eBay and retire!

graywanderer · 46-50, M

@Th1nkF1rst have you ever seen the youtube of the divorcing couple splitting their beanie babies in court?

whowasthatmaskedman · 70-79, M

@graywanderer Yes. I have never had one. Just lucky I guess. But the easy access to instant money is more tempting to the more vulnerable

Th1nkF1rst · 70-79, M

@graywanderer no

whowasthatmaskedman · 70-79, M

@Th1nkF1rst Yes. My Grandson tells me how much his Pokemon cards and Beyblades are worth. 😉