Fed increases target rate to 3.75-4.00%

Re:Fed increases target rate to 3.75-4.00% by avmich on Wednesday November 02, 2022 @02:42PM (#33440888)

The idea is that people will cut spending somewhat to have more money stored in saving accounts where they produce more low-risk return. Cutting spending will dampen prices.

Increasing interest rates increases the temptation to lend money instead of spending.

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Re:Fed increases target rate to 3.75-4.00% by apropos_g on Wednesday November 02, 2022 @03:32PM (#33441669)

> is that people will cut spending somewhat

Why would people cut spending on food and gas? They need both to survive. That's what the CPI is made of.

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Re:Fed increases target rate to 3.75-4.00% by avmich on Wednesday November 02, 2022 @06:06PM (#33443572)

Because people will cut spending on going to theaters somewhat, and that takes some gas to get there. No, short term people don't need theaters to survive.

There is some non-critical spending to cut, Feds rely on that.

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