-Treasury Yields
-Interest Rates
-Incoming Recession
-Unemployment Numbers/Layoffs
Why can't the economy and the stock market figure out what it's doing?
The Federal Reserve (also known as the "Fed") may raise interest rates for a variety of reasons, including:
- To control inflation: One of the primary goals of the Fed is to maintain stable prices, which means keeping inflation in check. When inflation starts to rise above the Fed's target rate, they may raise interest rates to make borrowing more expensive and slow down economic activity, which can help to reduce inflationary pressures.
- To slow down economic growth: When the economy is growing too quickly, there may be concerns about overheating, which could lead to inflation or other economic imbalances. By raising interest rates, the Fed can make it more expensive to borrow money, which can slow down consumer and business spending, and ultimately slow down economic growth.
- To attract foreign investment: When interest rates are higher in the United States compared to other countries, it can make investing in U.S. assets more attractive to foreign investors. This can help to increase demand for U.S. dollars, which can strengthen the value of the currency and support economic growth.
- To maintain financial stability: The Fed may also raise interest rates in response to concerns about financial stability. For example, if there are concerns about excessive borrowing or risk-taking in the financial system, the Fed may raise rates to encourage more prudent behavior and reduce the risk of a financial crisis.
Overall, the decision to raise interest rates is typically based on a complex assessment of economic conditions and the potential risks and benefits of different policy actions.
Disclaimer: All opinions from the hosts do not reflect investment advice or recommendations of any kind. This is not financial advice.