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Federal Reserve slashes interest rates to zero

washingtonpost.com

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Re: Federal Reserve slashes interest rates to zero

#271

Post by onlyrealcuzzo »

appleiigs wrote: post #130
barry-cotter wrote: post #122

Earlier quoted context omitted.

> Do you have a source for 80-90% collapse in China? That sounds way high I live in Shanghai. It normally takes about two weeks for things to go back to normal after Lunar New Year ends, which was two months ago. Things are not yet back to normal. Maybe 30% of office workers are back at work, 50% maximum. Gyms, bars, restaurants are almost all still closed. The dental hospital is still closed. You can basically write…

If you write off 2 months out of 12 months, that's a 17% decrease.

I think he was talking about the current situation, not the full year perspective.

How is that any different than saying 2 months out of a decade is 1.7%??

Re: Federal Reserve slashes interest rates to zero

#273

Post by Supermancho »

digitaltrees wrote: post #258
Supermancho wrote: post #211

Earlier quoted context omitted.

Cases are recorded. If it's not in a medical record, it's not a case. Technically, the reference was to ~3000 but someone then wanted to dispute that cases was not the same as infections. The number is irrelevant. If it's not known for sure, it's not a case and it's not a known infection, medically. I don't understand how factual correction gets downvoted, but here we are.

This is a pedantic word splitting argument. The relevant measure is number of people infected no the number we happen to know for sure because we finally got around to testing. If we had South Korea’s level of testing then maybe your argument would warrant breath behind words, under the current circumstances save your breath.

> This is a pedantic word splitting argument.

No, it's a correction.

>> > Also 3000 confirmed cases does not mean 3000 actual infections.

This statement is factually incorrect.

> The relevant measure is number of people infected no the number we happen to know for sure because we finally got around to testing

That is irrelevant to the response I gave. It seems to be a popular interest today, in trying to clarify a concept, which is unrelated. I am done engaging with this derail.

Re: Federal Reserve slashes interest rates to zero

#274

Post by legolas2412 »

trent_lott wrote: post #270
legolas2412 wrote: post #264

Earlier quoted context omitted.

Effective sure, but surely you could have a fairer way. For example, one of the variant of debt cancellation I hear about is the proposal by Sanders and Warren to cancel all student debt. Isn't that extremely unfair to people who chose to not go to college because tuition is costly? Isn't it unfair to people who put financial prudence in front of needless consumerism, by saving more to pay down their student debt?

Isn't it unfair to allow some companies to profit on student loans when others were more prudent and didn't lend to 18 year olds? All finance is done, of course, with pure equality! The people who didn't take student loans haven't had to live with them. They had more years working, with better pay, and without loan interest - they got nothing for their decision! Certainly not a piece of paper that entitles the holder…

Every loan company has a risk profile. It is completely fair for some companies to give high risk loans at high interest rates. What is stupid is the usa government not subsidizing education, but making loans backed by the government and then making them non defaultable.

> They had more years working, with better pay, and without loan interest - they got nothing for their decision! Certainly not a piece of paper that entitles the holder to work in a job unrelated to their studies and without any useful pay bump.

Not sure what you're talking about here. People who gave up on college gave up on in demand skills, higher future income, and got more stressful and demanding jobs.

Re: Federal Reserve slashes interest rates to zero

#275

Post by legolas2412 »

dcftoapv wrote: post #269
legolas2412 wrote: post #266

Earlier quoted context omitted.

And they kept the interest rates zero from 2008 to 2015, and spent trillions to prop up asset prices via quantitive easing. When they pumped the price to astonishing heights till 2015, what they did in 2018 was too late.

Too late for what? This was going to happen no matter what the fed did. If the mkt blew up because of inflation then your argument would make sense. That's not what happened.

Well if the quantative easing was phased out and interest rates started increasing in 2011, the stock market wouldn't be at all times high, billionaires wouldn't be so rich, but the economy would be better off.

Re: Federal Reserve slashes interest rates to zero

#276

Post by unlinked_dll »

legolas2412 wrote: post #264
colechristensen wrote: post #192

Earlier quoted context omitted.

An option not talked about much yet is cancelling debts. The Romans did it quite a few times. An effective redistribution of wealth from people who own things to people who do things.

Effective sure, but surely you could have a fairer way. For example, one of the variant of debt cancellation I hear about is the proposal by Sanders and Warren to cancel all student debt. Isn't that extremely unfair to people who chose to not go to college because tuition is costly? Isn't it unfair to people who put financial prudence in front of needless consumerism, by saving more to pay down their student debt?

>Isn't that extremely unfair to people who chose to not go to college because tuition is costly

I heard a good saying awhile ago. You shouldn't look into your neighbor's bowl to see if they have more than you, only if they have enough.

Student debt is not a good thing for our society. It's not a good thing that people made decisions based on having or not having such debt. If we rip the bandaid off we'll help millions of people, at the same time creating massive stimulus at a time when it is most needed. It's no more "fair" to do that then it was fair to bail out the bankers in 2008, the difference is the people getting bailed out will be immensely more in number and productive in their usage of the money.

Re: Federal Reserve slashes interest rates to zero

#277

Post by sfj »

js2 wrote: post #240

SARS-CoV-2 doesn't care about monetary policy. Why not give money directly to the people who need it? They'll spend the money right away. I'm willing to sacrifice my 401(k) and retire on just SS if need be if my government is willing to help everyone worse off than me.

Curious why you need to government involved? Why not just take your money out of your 401(k) yourself? You'll suffer a penalty, but people are in need.

Re: Federal Reserve slashes interest rates to zero

#278

Post by tree3 »

perl4ever wrote: post #132
nightski wrote: post #47

Earlier quoted context omitted.

Saving is preservation of capital whereas investing is growing capital. At least that is my take.

Ok, but parent is lamenting that "saving" pays less than "investing". You're saying that's implied by the (or your) definition so it seems like it would go without saying.

> "saving" pays less than "investing"

It does, except for when cash performs better than equities (like during a bear market).

Re: Federal Reserve slashes interest rates to zero

#280

Post by sfj »

sarah180 wrote: post #112
coretx wrote: post #69

The EU is printing more EUR, helping everyone. The USA is lowering the interest, helping the ultra rich.

This is effectively how you print money in a modern economy. They're giving banks access to a lot more cash and have reduced reserve requirements to 0%, meaning that banks can loan new money without limitation and without fear that they'll be able to borrow to cover those loans. Most money is not actually on paper, so the amount you print is not the point.

But who are they going to lend to? Aren't most companies losing cashflow due to loss of employees/supply, and don't have demand due to everyone staying home?

The only companies that are going to be borrowing are those that are out of money and need to try and weather the current crisis. If the banks make a mistake here and the companies they lend to go bankrupt, they go bankrupt too.

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