The Federal Resrve people ARE hard pressed to making money harder to borrow….
Inflation fight*!…
It’s supposed to drive DOWN prices….
It isn’t…..
We ARE moving into a place where Democratic Progressives are joining some Republicans like Rand Paul who are critical of the Federal Reserve actions….
The Federal Reserve is poised to raise interest rates by another 0.75 percentage points on Wednesday for the fourth time this year — the latest sign of how aggressively officials are fighting to slow the economy, even as the risks of a recession next year rise.
Fed officials show no signs of backing down, and they’vemade clear that getting consumer prices down from the highest inflation rates in 40 years will require pain for households and businesses. But what isn’t clear is when or how central bankers will decide to ease up — and if they will only scale back once it is alreadytoo late to head off a downturn. The central bank isexpected to raise rates again at upcoming meetings in December and February, before possibly hitting pause….
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The Fed has already hiked rates five times this year — the last three at 0.75 percentage points, which used to be considered unusually steep. The bank is moving at a level of intensity not seen in decades. Yet that fight is drawing increasing criticism, from economists and lawmakers, that the Fed is overcorrecting. Rate hikes take months to fully sink into the economy, and the growing fear is that the Fed will outrun its ability to gauge whether its policies are working. Even if the bank stopped raising rates, decisions its leaders have already made could arrive with a thud next year and roil the global financial system along the way…
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The Fed closely guards its independence from politics and makes decisions regardless of which party holds Congress or the White House. But Democrats on Capitol Hill have recently ramped up their criticism of the central bank, arguing that such massive rate hikes will inevitably hurt the labor market. On Monday, 11 lawmakers, including Sens. Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.), issued a letter to Powell warning that the Fed against inflicting needless harm.
“We are deeply concerned that your interest rate hikes risk slowing the economy to a crawl while failing to slow rising prices that continue to harm families,” the letter read….
American consumer prices are NOT leveling or Dropping like the Fed wants…..
For years, food companies and restaurants generally raised prices in small steps, worried that big increases would frighten consumers and send them looking for cheaper options. But over the last year, as wages increased and the cost of the raw ingredients used to make treats like cookies, chips, sodas and the materials to package them soared, food companies and restaurants started passing along those expenses to customers.
But amid growing concerns that the economy could be headed for a recession, some food companies and restaurants are continuing to raise prices even if their own inflation-driven costs have been covered. Critics say the moves are all about increasing profits, not covering expenses. Coca-Cola, PepsiCo and Chipotle did not respond to requests for comment….
“The recent earnings calls have only reinforced the familiar and unwelcome theme that corporations did not need to raise their prices so high on struggling families,” said Kyle Herrig, the president of Accountable.US, an advocacy organization. “The calls tell us corporations have used inflation, the pandemic and supply chain challenges as an excuse to exaggerate their own costs and then nickel and dime consumers.”
So far, food companies and restaurants have been able to raise prices because the majority of consumers, while annoyed that the trip to the grocery store or drive-through for takeout costs more than it did a year ago, have been willing to pay. But there are plenty of shoppers, including those with lower incomes or retirees on fixed budgets, who say the higher prices have led to changes in their routines….
*Note…
Some of us feel America is ALREADY in the beginnings of a Recession also….