"Since 1990 the Fed has cut rates in the final two months of a presidential campaign only three times." That's three times out of eight elections. How is that exceptional? Any rate *increases* before those elections?
The Fed has a three more meetings this year, including today’s. Based on the weakening economy, they probably need to cut 75 basis points across those meetings. Leaving 25 for the December meeting, they can cut 25 today and 25 the week before the election or 50 now and pause till December. Trump is going to rage no matter what, so better to cut 50 today and be done with it. If the Fed cuts 25 today and skips October, they risk getting blamed for tanking the economy by keeping the brakes on much too long.
Strong central bank independence, as has prevailed in the era of inflation targeting is highly problematic. In particular, even though the target range is obviously too low (too close to the Zero Lower Bound), it can't be changed because to do so would threaten CB credibility and therefore independence. And it's important to observe that, like all institutions, the interest of the CB in its power and independence doesn't necessarily coincide with the national interest
What is needed is an integration of monetary and fiscal policy, in which the CB would be independent of direct control but would try to co-ordinate with Treasury. Admittedly, this is less relevant in the US case where Congressional paralysis makes fiscal policy just about impossible.
Ah, now I see. The last paragraph says it all. She's a partisan. She doesn't want you to see clearly, only to follow the party line.
BTW she engages in two flat out lies. Trump's growth while in office was historically high, and we don't know what causes inflation. Trump's attacks on our trading partners certainly didn't.
One of the aspects of Trump’s political career is that everything has become political because he inserts himself in everything.
"Since 1990 the Fed has cut rates in the final two months of a presidential campaign only three times." That's three times out of eight elections. How is that exceptional? Any rate *increases* before those elections?
My thought as well. Thank you!
The Fed has a three more meetings this year, including today’s. Based on the weakening economy, they probably need to cut 75 basis points across those meetings. Leaving 25 for the December meeting, they can cut 25 today and 25 the week before the election or 50 now and pause till December. Trump is going to rage no matter what, so better to cut 50 today and be done with it. If the Fed cuts 25 today and skips October, they risk getting blamed for tanking the economy by keeping the brakes on much too long.
Strong central bank independence, as has prevailed in the era of inflation targeting is highly problematic. In particular, even though the target range is obviously too low (too close to the Zero Lower Bound), it can't be changed because to do so would threaten CB credibility and therefore independence. And it's important to observe that, like all institutions, the interest of the CB in its power and independence doesn't necessarily coincide with the national interest
What is needed is an integration of monetary and fiscal policy, in which the CB would be independent of direct control but would try to co-ordinate with Treasury. Admittedly, this is less relevant in the US case where Congressional paralysis makes fiscal policy just about impossible.
"The Fed may move more cautiously this week at least in part because policymakers want to know the outcome of the election"
"Fed Chair Jerome Powell is adamant that the central bank’s interest rate decisions will never be based on politics"
These are two contradictory statements, one right on top of the other. Whew.
No really. One is the author's speculation, the other is Powell's insistence. She simply doesn't believe Powell.
Ah, now I see. The last paragraph says it all. She's a partisan. She doesn't want you to see clearly, only to follow the party line.
BTW she engages in two flat out lies. Trump's growth while in office was historically high, and we don't know what causes inflation. Trump's attacks on our trading partners certainly didn't.
This reporter is not writing well. There is no clarification of an obvious contradiction.