Re:Inequality, Interest Rates, Aging, and the Role of Centra...
by dragonwriter on Wednesday September 01, 2021 @03:00PM
(#28384193)
> They can set the Fed fund rate anywhere they want... if they are willing to accept the consequences of doing so
Sure, the “consequences of doing so” is how they choose where they want to set them.
The upthread suggestion that the 30yr Treasury rate puts an effective cap on target rates because a yield inversion will cause a recession (and, implicitly, Treasury rates are unresponsive to the policies that are used to achieve the Fed funds target) remains false and based on mistaking a symptom with a cause of recessions.
Sure, the “consequences of doing so” is how they choose where they want to set them.
The upthread suggestion that the 30yr Treasury rate puts an effective cap on target rates because a yield inversion will cause a recession (and, implicitly, Treasury rates are unresponsive to the policies that are used to achieve the Fed funds target) remains false and based on mistaking a symptom with a cause of recessions.