Re:Pyrrhic Victory
by marcosdumay on Wednesday June 17, 2020 @02:52PM
(#23555202)
It' not coherent because both printing money and borrowing cause the interest rate to increase. Low interest rates is a reaction from the market to the conditions the government puts on the table, not something that the government sets at will to push an agenda.
[ Parent
| on HN ]
You must have not been paying attention to financial news over last decade.
> When the Federal Open Market Committee wishes to reduce interest rates they will increase the supply of money by buying government securities. When additional supply is added and everything else remains constant, the price of borrowed funds – the federal funds rate – falls.
https://en.wikipedia.org/wiki/Federal_funds_rate#Explanation...
Re:Pyrrhic Victory
by marcosdumay on Wednesday June 17, 2020 @04:39PM
(#23556452)
Yes. "When everything else remains constant" here means people choosing to take that extra money and immediately lending it to the government. It's not the government that makes this choice.