Fed Cuts Interest Rates by Another Quarter Point

The Federal Reserve cut rates for the second time since July as risks to the economic outlook mounted. Its policy continued to anger President Trump.

Comments: 208

  1. So, Trump has made America is no better than China when it comes economic manipulations.

  2. @Independent American Trump has no ethics. No morals. No ideology. He doesn't believe that two wrongs don't make a right. All the whataboutism he and his supporters display indicates that their attitude is do what you can get away with, right or wrong. Even if the ones you accuse of doing it didn't really do it at all. But a lot of Republicans, like Mitch McConnell, have been doing that already, for a long time. At least the relatively fewer Dems who do it try to hide it, and are embarrassed when they get caught.

  3. @Independent American Fishy.

  4. The cut is a mistake we will regret as conditions worsen and this source of relief will have been found to be depleted. Powell is playing to Trump’s toon but will nevertheless be lambasted for not swinging hard enough. Serves him right. Hard to respect a chairman who doesn’t respect the independence of This country’s central bank.

  5. The house of cards continues. Keep believing and it can go on forever...or not.

  6. There is no appeasing Trump unless everything is precisely his way, wise or not. Meanwhile, is this rate cut, to say nothing of a near-future cut, wise? We will be so close to zero as to have little leverage when we do hit a recession. Negative interest rates will hurt almost every saver, but especially retirees, who depend on interest in part to support themselves. Terrible idea!

  7. In the context of malignant macro economic conditions created by Donald Trump's corporate welfare and reverse Robin Hood gifts bestowed upon wealthy corporations and individuals via unnecessary tax cuts, this interest reduction is an ominous portent of an impending massive economic reversal. This next recession is going to be a doozie. Brace yourself!!

  8. While the interest rate cut helps some Americans, it hurts those Americans who depend on interest income for retirement. It discourages savings. Adjusting interest rates to steady the economy that has been upended by Trump's trade wars is like wagging the tail to control the dog. American leaders must forcefully tell Trump that he is destroying the economy and must stop. They must galvanize pubic opinion.

  9. @Francis "American leaders must forcefully tell Trump that he is destroying the economy and must stop. " But he listens to no one but himself.

  10. The RISK is Trump. Period.

  11. @Phyliss Dalmatian Phyliss, you have that right. Probably the worst president in American history.

  12. What about home refinancing? Theres not much of value here on the upside for consumers or homeowners. Just a global focus. Insufficient news piece.

  13. Even Powell's own committee was unhappy with this decision. The vote was 7-3 and non-voting members were not favorable either. The FED is rarely this divided. Meanwhile the economy continues to be strong and core CPI yoy is surging above target. Unemployment is at record lows and the stock market near record highs. It's not the environment for emergency measures. Despite this, rates are being cut in an attempt to placate the chosen one, who is going to be distinctly unhappy the FED is not cutting rates to zero and restarting QE. Sad to see a supposed independent body this politicized. Surely Trump will fire Powell and replace him with uber dove Bullard, the sole member to vote for a 50 basis point cut. That seems to be the way people get hired in this "administration".

  14. @James Trump cannot fire Powell as he doesn't have that power. Powell reports to congress, not the president.

  15. B-b-b-but I thought the Trump tax cuts were a panacea for everything that was wrong with the economy? I don't understand. [/sarcasm]

  16. Based on th chart, the rate cuts do nothing to prevent recessions. It seems more like a response that is too late.

  17. Just act based on the data Jay, not what Trump wants. He and Jared have massive debt to refinance at lower rates. That's the primary reason he wants lower rates. Act on the data.

  18. Good news for the wealthy, including Wall Street investors, Fed members and their cronies, politicians, and presidents.

  19. Powell clearly isn't independent in his decisions but rather influenced by the Trump tweet tirades. He has not only lost support for his decisions within the Fed, but also significantly lowered his response opportunities should these cuts fail and the US slide into a recession despite. Look for a free fall in that case.

  20. I thought the economy was in great shape- better then "other countries" . So what the rewal story- you know, the truth?

  21. Donald needs more cough syrup medicine for his weak economic house of mirrors. Oh he's a 'businessman' alright.....that drives businesses out of business; you can look it up in bankruptcy court. November 3 2020

  22. Seeing your comment brightens my day despite the gloom that pervades everyday since Donald J. (Genius) Trump was anointed president.

  23. Yes, mr trump, we will lower interest rates yet again to further enrich you, your family and your sycophants.

  24. Trump is going to be REALLY mad, and scream they should have done 1%. He and his buddies were all long, and the market didn't rally by 300 points. Well, actually he did: Jay Powell and the Federal Reserve Fail Again. No “guts,” no sense, no vision! A terrible communicator!

  25. September 5, 2016 - YOUNGSTOWN, OHIO (Reuters) - Republican presidential nominee Donald Trump, who has previously accused the Federal Reserve of keeping interest rates low to help President Barack Obama, said on Monday that the U.S. central bank has created a “false economy” and that interest rates should change. “They’re keeping the rates down so that everything else doesn’t go down,” Trump said in response to a reporter’s request to address a potential rate hike by the Federal Reserve in September. “We have a very false economy,” he said. “At some point the rates are going to have to change,” Trump, who was campaigning in Ohio on Monday, added. “The only thing that is strong is the artificial stock market,” he said. Funny how his tune has changed.

  26. @Susan Susan, you know that, if challenged, the Swamp King will tweet furiously that he never said that, that it is only fake news … and his base will lap it up, as they, lemming-like, go down with the sinking ship.

  27. @Lone Protester, and Susan, the hypocrisy from con man 45 is par for the course.

  28. @Susan I doubt 45 could even spell 'hypocrisy' without looking it up.

  29. What will we do when the business cycle does its thing?

  30. Trump is dealing with the economy like he has been with climate change, national security, infrastructure and other critical issues. He is ignoring those with deep knowledge and expertise about how the world works and what puts global stability at greatest risk. He enriches the rich and exacerbates the growing concentration of wealth in this country to the detriment of most Americans and ultimately, the wealthiest although it's the former who will suffer the most and longest.

  31. Well, now we know who’s gonna be blamed if Trump loses in 2020. Nothing like serial bankruptcies to make one an expert in economics.

  32. Will this move by the Fed panic market investors into thinking that a rate cut means the Fed sees trouble down the road?

  33. @RLW It does that to me. I will be looking to pare stocks.

  34. Yes.

  35. Let me understand this: * Unemployment at all time low * Wages rising * Inflation likely to go up due to oil prices going up * Everyone says a recession is looming soon Yup, perfect time to lower interest rates to zero. When the recession does come, Powell can sit on his hands because he has nothing left to counter the down turn. It doesn't take an advanced degree from Stanford, like mine, to figure out this is the worst possible action the Fed could take.

  36. @MoneyRules Milton Friedman repeatedly insisted that the Fed cannot control interest rates. They can control the money supply by printing money (writing checks with no backing to the Treasury for Treasury notes, otherwise called monetizing debt, sort of a fictitious direct deposit to the Fed). No need for any sort of advanced degree to grasp the idea, as he spelled it out in an easy to read little book entitled Money Mischief. None of his work is conceptually difficult in any case, including his work on money, though he did not have much of a grasp of science or statistics. But making it easier to lend money is useless when no one wants to borrow. Trump doesn't get that, as he always wants to borrow money. And trying to control the debt market, which is auction driven, can be dicey if buyers simply don't pay attention to your intentions: witness, for example, the failure to raise interest rates when the Chinese bought everything in sight at auction, keeping rates low, during Bush the Younger's administration.

  37. @J Chaffee Maybe this will be a time for developers and resource extraction companies to borrow. Could it be that Trump intentionally engineered this for these types of organizations, against the everyday voter and their family? Or is the current economy just an accident born of failed trickle-down voodo and rash trade efforts?

  38. @J Chaffee A) this was a theory, B) The fed has trillions already on its balance sheet from QE that cannot sit there forever and C) interest rates to matter because they determine bank lending rates. There's a huge surplus of capital in the market place creating an asset bubble never before seen in history. Good luck with that one.

  39. I fear that this rate decrease is to not “stimulate” borrowing but to increase liquidity and bail out the big players in the bond market. Some folks made some big bets. The 40 basis point jump in 10 days is hard to comprehend. 60 basis point drop during the month of August. 2.08 to 1.47. What big “Long Term Capital” player got bailed out. I think this has something to do with why Trump has moderated his position on “lock and loaded”. I am waiting for the other shoe to drop. The NY Fed intervened for a reason. What is that reason? Who or what requires a 50 billion bail out? Normally an attack on the Saudi oil fields would have seen a huge flight to treasuries. But between Friday and Monday only a 6 basis point drop in the 10 treasury yield. Who did the New York Fed bail out? This retiree wants to know!

  40. The good thing about Trump is that none of our most important institutions listen to him, thank goodness. Powell sees sluggishness and wants to gently stimulate the economy. He has little room to maneuver with rates this low, which is why the cut was not unanimously supported. Anyone who thinks that zero rates are good need only to look at Japan and The Lost Decade(s.)

  41. Spot on!

  42. This move is sadly lacking in consideration of the future. If the economy tanks, as some economists say it will, how's the Fed going to counteract that? Trump is only looking out for his reelection prospects. The economy is the only thing he has going for him. If it tanks, so does his likelihood of reelection. This is not at all fiscally responsible.

  43. @VickiFuture? Future? What future?

  44. The Fed is making gradual interest rate cuts in contrast with Trump, who wants drastic action. But most agree that the recovery is slowing and some stimulation is called for. The one organization that differs is probably the most important. According to the IMF, world growth was at 3.5% last year, has dropped to 3.2% this year, but is expected to return to 3.5% next year. Despite all the supposed signs of decline, the world economy seems to be doing ok. If you stimulate a healthy economy, you tend to create inflation. We have been in a long period of growth without inflation. But we were burnt in 2008 and have been traumatized. Everyone from Trump to Krugman is fearful of another recession. No one fears inflation. That is a mistake.

  45. Oh dear, the chancellor won’t like this - as we all no he wants minus points. So be prepared for another job change. Has anyone seen Ivanka holding a calculator?

  46. I am so strung out already. And Trump says that this is a “great” economy. Real, working Americans will not be able to handle another crash or even slump in the economy. I work at a factory in Ohio. We already have employees sleeping in their vans outside, blocking the light out with trash bags. The Fed will have nowhere to go once’s things get really bad. We need good quality healthcare. We need affordable childcare. We need unions We need structural change.

  47. @Mike If you need structural change, do not vote for Republicans. They do not care about struggling Americans.

  48. We need to vote Trump out of office.

  49. @Mike And America needs folks like you and all of your fellow citizens to vote wisely.

  50. When people are at the extremes, the marginal effects of monetary policies are slight. There is not enough wealth amongst consumers to increase demand and without that potential, investors and lenders will not change what they are doing by much. The factors leading to recession are not going to be offset by an interest rate cut with such low interest rates previously in effect.

  51. So this begs the question, did they do it because of sound financial analysis, or because simply Trump wanted them to?

  52. I mistakenly thought Chairman Jerome Powell would be a Profile in Courage. Interest rates must get to 3% to provide stability to our financial system and citizens. This is not complicated.

  53. Now who here really believes this is about keeping the economy strong? I am going to go out on a limb (not really) and say that a certain "King of Debt" businessman masquerading as a president is loosing HUGE amounts of money and would love to refi his debt near zero, or negative rates, because wouldn't it be great if the bank paid you for taking out loans? Especially billions of dollars worth. Nah, I don't believe Trump's rate obsession had anything to do with the economy.

  54. Trump's main beef with Powell and the Fed earlier this year was the bank's turn toward (very mild) hawkishness under Powell. In other words, Powell has been doing what Janet Yellen should have done years ago, but lacked the guts to do.The rate hikes under Powell are far too small, of course, and the Fed's balance sheet continues to be enormous. Powell knows that dumping the Fed's assets, which would have few buyers in the open market, deflation would likely set in. (According to the dominant ideology in DC, this would be a terrible thing.) But at least Powell appears to realize that unless the Fed can get the target rate back up to a level sufficiently above zero to allow for maneuvering in case of recession, the Fed will be boxed in. Trump, who has never demonstrated any actual grasp of monetary policy — or economics in general — just wants to keep the current boom going. And whether he knows it or not, the "false economy" Trump pointed to under Obama is now Trump's false economy.Trump doesn't want that to go away so he now publicly calls for lower interest rates. Given this, it's now a pretty safe bet that if recession does come during Trump's presidency, he'll be calling for ever-higher levels of stimulus and QE infinity. If he's pushing so hard now for low rates, just imagine what he'll do when the going gets even tougher. The most dangerous words in the English language" This time is different."

  55. What impact will this Fed interest cuts have on whatever profitable Trump Organization advantage that is hidden from the American people in Trump's personal income tax return and business accounting financial records arising from Trump's occupation of the White House? Trump calling for Jerome Powell to cut interest rates has already given the appearance of corrupt craven dependent political partisan fealty by the Feds.

  56. How fragile and illusory was the independence of the Federal Reserve. It disarmed itself before the coming recession because of a few mean tweets from the President.

  57. @Walt Bruckner Actually, no. They're trying to head off a recession. Problem is, they have little wiggle room left for tweaking interest rates - certainly not in the headwind of Trump's inane economic policies. You'd only go negative rate if the economy was in deep trouble - and that would be a panic move. A few weeks ago a Trump supporter commented why should we worry about the economy - the government can just print/create more if we need to. Seems like that might just be what Trump thinks, too. I mean, that's pretty much what he wished he could do for his failed businesses. It's what he basically experienced when it was Daddy bailing him out again and again.

  58. @Barry Williams It is really a recession if an economy is just returning to a more normal rate of unemployment? To think that we can operate long-term with 3.7% unemployment is more than optimistic. The Fed erred by waiting too long to increase interest rates after the recession of 2007 and letting unemployment get below the long-term norm. Now Trump will do anything to maintain our current level, regardless of the long-term consequences (note his assault on decades of environmental regulations that have improved our lives). What works in the short term will only make the inevitable worse.

  59. The reason that there is so little wiggle room with interest rates is that late stage capitalism is an oligarchic kleptocracy that requires a state subsidy to survive. That is essentially why the Davos crowd (and their acolyte in the presidential race, Andrew Yang) is so enamored with Basic Income Guarantees. It is a bribe to keep consumption-based capitalism intact, as is artificially low — and soon to be negative — interest rates.

  60. So if the economy is so great, why do they keep lowering the rate?

  61. Apparently our economy is much weaker than we had been led to believe. While the Times article dwells exclusively on cyclical factors to account for that, I think we should give attention also to structural factors. One of these is an undereducated, oversubsidized labor force. Another is overregulation of industry, which has driven millions of jobs off shore. Another is the payroll tax, which drives jobs out of industry and into the "gig" or shadow economy.

  62. You object to payroll taxes? Where do you think Social Security checks come from?

  63. @Rob Kaufman That's just the point. Business is forced to subsidize these programs like social security, which contribute nothing to profit and productivity. And then we wonder why foreign manufacturers are eating our lunch.

  64. @James Ribe: Hope I live long enough to see you get to be old and poor. Pa-tooey on youse.

  65. Trump probably thought the stock markets would go up after the rise. The guy understands nothing about economics, and little worth anything about business. Except the criminal way of running one. Which is how he's trying to run the USA.

  66. @Barry Williams Without a doubt,a perfect description of where we are right now. I am continually impressed by the vision of our Founders. The emoluments clause is an example. How did they know there would be a DJT?

  67. @Mike Westfall That actually isn't that hard to predict - their world had seen it before. Especially men like those, most of whom had read at least some of the Bible or had some familiarity with enough of the Old Testament. Evidently, what they didn't foresee...or hoped they had provided for enough to forestall...is how the nation they forged could end up with so many venal, craven politicians running it such that things like the emoluments clause can be all but forgotten.

  68. So much for Trump’s hope that cutting rates would boost the market, the only measure he cares about. Even if it indicates a weakening economy. His motivation to push for negative interest rates, punitive for savers, is also based on the expectation that the market would be thus artificially inflated, as people have no other forms of investment left. I suppose it would be a good time to purchase real estate - if you can take that risk in a bad economy! once again, the rich get richer

  69. One must step back a few years, maybe a lot farther than expected. And, ask the question where have all the $Billions gone that the gov't gave the business community to build, to grow, to add jobs, to increase investment, to raise wages, to lower unemployment rates, to increase jobs, to increase exports, to lower business taxes, to do all those wonderful things economist and the GOP say are needed, that will result in a vibrant, increased economy, where have those $Billions gone? All those dollars paid for not by the wealthy, but by the working middle and lower classes. What has been accomplished?

  70. @Me Too Stop whining, We made the oligarchs super wealthy and the investor class. Jamie Dimon of Chase is worth over 1.5 billion dollars and makes $33 million a year before investment income and he is small change compared to Mark Zuckerberg or Jeff Bezos. We can all be proud that we made them the Masters of the Universe, just ask trump. We owe a debt of gratitude to the Republicans for being the facilitators. You will soon have the opportunity to give up your Medicare and Social Security so that we can further enhance their bank accounts.

  71. @Steve I'm not whinning, just asking a valid question. As to medicare and soc security, you are right, less for me and more for the wealthy's bank accounts. Thanks for the reminder.

  72. @Me Too I was being funny.

  73. Let me understand. Our economy is fine, Germany's not so fine. That's not a sufficient reason to cut our rates further to historical lows. If there's comes a time when there's a real problem with our economy, they will have already used up their ammunition. The Fed should be an independent body as much as possible to balance economic growth and inflation. It's not possible, under this particular President.

  74. In spite of the trump tariffs the Chinese have him over a barrel. If US consumers need clothing or household goods where are they going to get them from at any price but China. We don't make anything in the US anymore.

  75. @Steve US industrial production is as high as it has ever been. We just don't need as many people to do it due to productivity improvements. What the US doesn't do as much any more is low skill/low capital work. An example is clothing. Cotton from Alabama is shipped halfway around the world to Asia to be sewn into T-shirts, then shipped back to Alabama to be sold at Walmart. Cotton farming is very capital-intensive, needing big tractors, balers, and transport trucks. Sewing only needs a $600 industrial sewing machine and a few weeks training to do quickly. So it goes to the places where labor is cheap.

  76. 1. The Fed does not operate in a vacuum. It operates in a global economy. That is, its decisions are influenced on what the Central Bank of Japan (BOJ) and the European Central Bank set as rates 2. The EU is the words largest economy . Last Thursday the ECB cut its deposit rate to a record low of minus 0.5 per cent and restarted its €2.6tn quantitative easing programme of bond buying to supresss the long term interest rate (Contrary to Mr. Krugman’s claim in the NYT on 0/15 the Central Banks since 2008 set both the short term AND long term interest rates. The latter with QE) Japan is the forth largest economy. The BOJ targets are - 0.1% for the short term interest rate, 0% for the long term interest rate 3 Two days ago, the ECB announced that it was prepared to cut rates again 4 Last Thursday, Mr Draghi, head of the ECB denied that his his move was to lower the exchange rate of the Euro Of course it is. The Euro promptly fell to a new low, The EU economy is export driven, and the best way to boost it to make exports more competitive by making the Euro fall 5. That is, we ARE in a currency war, never mind that the Central Banks deny it. Of course they would

  77. Great. Another personal benefit for Trump. Another "nothing" for the American people. Trump gains $850,000 for every 1/4 percent interest drop. That's why he pushes the Fed so hard to lower interest rates. He owes Deutsche Bank $380 million in 4 variable interest rate loans, so lower interest rates benefit his personal wallet enormously. He's done his best to trash Americans' personal economy, and with his trade wars and tariffs, has trashed the world's economy. This ranting at the Fed to lower interest rates is aĺl for his personal benefit. So, Ka-ching! Trump just won himself $850,000! Sources: Business Insider and Bloomberg, August 2019

  78. @Lilou Great points. They make me wonder if Trump actually had a nefarious motive when he began throwing gravel into the gears of the world economy with his trade wars. Hard to believe Trump could be clever enough to conceive of such a stunt, but he certainly possesses the requisite greed.

  79. @Think--I think he's really familiar with tax dodging, with inflating personal wealth to get loans, then deflating the same wealth to pay taxes, or to pay loans back. He is not alone in this--it's typical of those who have enough wealth to hide. He knows how to use real estate loopholes, how to benefit from banking transactions, how to pump up how excellent his properties are to attract investors. Then he refuses to pay the contractors who build them. He knows the ins and outs of being sued and winning, the art of the payoff and that of the settlement. He bullies employees into signing nondisclosure agreements. He's well-versed in bankruptcy, having gone bankrupt 6 times. He knows how to not obey the letter or the spirit of the law. HIs dad and mum taught him racism, dad schooled him in tax dodging. They were both sued for refusing to rent apartments to people of color. So he has a ton of knowledge and experience in taking advantage of institutions, laws and people to accumulate wealth. No one ever accused him of being kind. His tax returns probably reflect undervalued property and overvalued debt, plus dodgy deductions. I'd like to know about his investments in fossil fuels. He loves them, has destroyed the EPA and environmental protections for them. What is his financial return in them? I think it's more than campaign donations, and possibly well-hidden in off-shore accounts under proxies.

  80. @Lilou Grifters gonna grift.

  81. Low interest rates and deficit spending were the only things keeping the Obama Economy afloat. Why should we expect anything different now?

  82. @EGD So you are saying Trump is copying Obama? Trump would probably fire you for that if he could.

  83. @EGD I will take the stability of the Obama administration over the erratic mess we have now. Obamas policys especially his meaningful middle class tax cut raised up out of a almost certain depression. The debt he inherited from the previous republican administration was the result of a reckless tax cut while putting a multi trillion dollar war on the credit card. I'm sure you probably know this.

  84. "Sharpie-gate" should give everyone a crystal clear view of the lengths that Trump will go to in order to protect his incorrect views. To have press conferences and vitriolic statements about the National Weather Service to defend one of his tweets when he could have just let such a minor issue die is indictive of the infinite length he will go to in order to promote his view of our economy. Mr Trump has defaulted on many debts in the past. His overwhelming desire to take from lenders via artificially low interest rates to fund his agenda (and personal real estate empire) is yet another example of how others pay the price for his riches.

  85. John, speaking of Sharpiegate, is nobody surprised he even found Alabama on a map? I know I am.

  86. Greatest economy ever needs constant rate cuts?

  87. This is not what a free market economy looks like, and we've seen what happens when the economy running on borrowed money. Please vote for Elizabeth Warren. She can win, and she can make capitalism work for the people who are actually doing the work.

  88. What a sad state of affairs. A president imposing tariffs on a whim and when he can't get what he wants. He's hurting our economy, the stability of trade around the world, hurting American farmers and other businesses which are subject to retaliatory tariffs, hurting all American consumers with higher costs of living, people already struggling to survive. He couldn't care less. He's playing a game with our economy when he's not playing golf. As the economy falters he blames others and villainizes the Fed. But only he is to blame. Oops, take that back...he, the Republicans in Congress and their voters are all to blame. Make America great again must be a reference to the period in American history prior to the hard work Alexander Hamilton, et al did to unite the states with the Constitution, rescue our nation from bankruptcy, and put us on a sound financial footing for economic growth. That period had everything Trumpian: economic insecurity verging on national bankruptcy, white male power dominance, blacks oppressed, states divided, people suspicious of one another, deep distrust of the federal "government." But one good thing American government had in that early period of our history, that we don't have today, is men of genius, knowledge, self sacrifice, vision and patriotism. Such men and women are now running for the Democratic nomination. So there remains hope.

  89. Let us look at the last time when interest rates were low, The banks refused to lend to the SMB client base, rather used their cash to prop up the stock market and made money for themselves. The real reason why the EU, BOJ are looking at lower rates is to spur domestic consumption, and prevent the weak EU economies of Greece, Italy, Portugal, etc from destroying the Euro. EU economies benefit from domestic consumption as they have double digit VAT's or GST type taxation built in. In the USA, retail is collapsing, Auto is mired in labor dispute, tariff wars, and regulation that is State led, rather than Federal. If the banks pass the lower rate to clients, to refinance homes, buy cars at 0%, reduce interest on student loans, then this will have impact. It is also supposed to help imports, but with our Tariff weapon being unleashed at China, EU, other allies, that is dented deeply.

  90. The president’s petulant remarks are beyond tacky.

  91. Beyond manly, too. Where is repeat where is Our President's testosterone, the world wonders.

  92. Outstanding. Trump creates a financial crisis with his abominably ignorant tariff idiocies and then bullies the Fed into dropping the rate yet again. We know what this is all about. So he can essentially do a re-fi on the billions he owes to banks and oligarchies around the globe. It’s like a whole new level of dishonesty from what has to be the most dishonest president to ever stain the Oval Office. I think we have an answer to Nixon's famous quote just before he quit in shame. Our president is a crook. He needs to go now. November 2020’s too late.

  93. Ok Don, look in the mirror, and repeat this in a perpetual loop: “No ‘guts,’ no sense, no vision! A terrible communicator!”

  94. When you keep cutting the rope there may not be anything to hang onto. Just saying.

  95. Bullying from 45 is the cause of this. This FED leader is incompetent if he can't keep his decisions separate from the president. There is nothing sacred left in our institutions under this deplorable administration. 45 will do anything to get re-elected which he does not deserve.

  96. Is there anyone who isn't afraid of the bully other than Iran, North Korea, Putin and the Saudis?

  97. The destruction of our country continues unabated! IRS, DOJ, USAF, NOAA, and now the Federal Reserve. All corrupted by the Trump maladministration. No one will trust any government agency again after this travesty.

  98. Weak President. Weak Federal Chairman. Creeping us towards a dangerously fragile and weak economy.

  99. And, Trump attacks the Fed as gutless and without vision. I will trust the Fed first, as President Bankruptcy Six Times knows not what he is talking about, of course unless it benefits him above all.

  100. @TIm Love Lower interest rates *do* benefit Trump. He owns a real estate business, and interest on borrowed money is typically the largest expense for such businesses. Pardon the pun, but this is a big conflict of interest for Trump.

  101. 1 year: 4 months: 2 days until Trump is out. But who's counting? :/

  102. @Harmon Smith Can we have a clock to the minute like the national debt one?? CAN'T HAPPEN QUICK ENOUGH!!!!

  103. Tragically for Donald Trump, America has not become his fiefdom YET. The Federal Reserve exists to serve us and not "The Chosen One" AKA "Michigan Man Of The Year." The Federal Reserve Board needs to keep our countries best interest in mind when they make rate cuts and sadly that is now in question.

  104. PLEASE , Son of Liberty, don’t besmirch my home state like that!!! There are plenty of critical thinkers here in Michigan, and we know a beady eyed rat when we see/smell one. Michigan Man of the Year, indeed. Foist him off on a red state that REALLY loves him, like West Virginia. And good riddance.

  105. Thank you President Trump for putting lie to the fanciful notion of central bank independence. Feel free to continue your beat-down of these unaccoutable monetary mandarins for more interest rate reductions.

  106. And who should Federal Reserve Bank be accountable to? The stable genius in the White House? Our politically riven Congress? The Wall Street profiteers? Everyday Joe and Jane who can’t spell central bank, let alone have a clue what they do? No thanks. I will stick with them doing their technocratic best to fulfill their dual mandate while they ignore the short-term thinkers all around them, not to mention those who barely think at all.

  107. @Mike Iker How about accountable to the United States of America? And not their masters in finance and banking where the next career move is likely to reside.

  108. Fed is acting like a inexperienced and frightened soldier. It reacts to nervous stock market like a soldier shooting off all his ammunition at shadows. When the assault or recession comes, it will have no ammunition.

  109. @Robert Fallon It appears to me that the Fed is lowering rates to avoid a recession before it starts. A recession caused by Trumps failed trade war.

  110. @Steve When you don't have many bullets it is sometimes best to fire them early when you see trouble.

  111. Please someone make it stop. Trump sabotages the economy with erratic and capricious trade and tariff policies. He handicaps our fiscal outlook with deficit-fueled tax cuts that did little to stimulate the economy. Then he browbeats the Fed for not adequately counteracting his own policy failures. This is the economic equivalent of a dog chasing its tail – except its putting us at risk of a recession and costing American businesses and consumers billions of dollars in tariff payments to the US Treasury. The outcome of the fight ‘Tariff Man’ picked with China is foreordained. China’s is a 3000-year-old civilization and should have no problem waiting out Trump until January 20, 2021.

  112. We know where this is headed. The Fed will cut and cut and cut...till there’s nothing left to cut. Negative rates ahead!

  113. Excellent informative article. Good journalism.

  114. So did Powell do this to avoid being called a Bone Head again or even worse. I don't mind so much as I am currently saving money for a down payment for a house in the near future, so Powell if you want to cut the interest rates again in the near future, be fine with me, and I won't even call you names.

  115. @Ricky I agree, I will call him good names and send him thank you notes as I also prepare to buy a house.

  116. I think it’s time we give trump another job, he can also serve as the president of the federal reserve. After all folks he is an economic whiz, just look at what he did for all those kids at trump university!

  117. @Jonathan P And all those New Jersey Casinos!

  118. Not to mention the thousands who lost jobs, pensions and benefits when he bankrupted four casinos. Thankfully trump himself didn’t lose any money!

  119. Feds do not cut already historically low interest rates with a strong economy - It is being done solely to artificially make the economy look better than it is going into the 2020 elections to appease Trump. This is not a good idea, and will make the looming recession even worse.

  120. @S B I doubt it will be "only" a recession. This is a record-high economy. We are surfing at the top of an high wave - a wave so big there is no precedent.

  121. @Observer On paper it looks like a strong economy. In practice, it is not strong. and there are many indicators to show this. Many people still are not doing well. Housing prices are out of control - wages have been stagnant. So, the economic recovery has not been evenly distributed.

  122. What goes up must come down. It's not if, but when the stock market will crash (again). It's at record highs so it will probably be a record crash. With the interest rate and taxes already so low, what can be done to stimulate the next depression? Besides tweets from an angry clown, that is.

  123. One of the best performances by a Fed Chairman I have witnessed. Powell was cool, articulate and clearly knowledgeable about the steps taken and its basis. His press conference was outstanding in the manner in which he addressed his many questioners and dealt with every query with patience and respect. Our Fed is in capable hands.

  124. @Karn Griffen Also he's able to operate while being insulted constantly by the wanna-be dictator president we have now. All the more power to him!

  125. Say what you will, but President Trump has been the lone voice calling early on the Fed string of interest rate increases a mistake. And he correctly put pressure on the Fed to reverse course. The Fed, reluctantly, has no choice but to recognize that the President was right, and the Fed was wrong and is reversing course. Of course, the President wants them to correct their mistakes faster. The USA now has the highest interest rate amongst our developed country peers in Europe and Japan (which have negative rates even). Trump was right all along, and is right. The Fed is lagging the economic reality. It is incalculable how much damage has been done by the Fed raising rates so many times in the past 18 months. And this week, the Fed could not even keep the minimum money reserves liquidity - it's basic function - operating normally. Companies didn't have cash available to pay their taxes. The Fed and Powell, indeed, were boneheads. They should be ashamed.

  126. @Baron95 It is normal to raise rates when the economy is doing well to allow for lowering when the economy needs a boast and to keep inflation in check. What is not normal is Trump's trade war and what it is doing to our economy. Trump knows he has our economy in a bad place right now and needs the Feds help sooner rather than later due to the upcoming election.

  127. @Steve "It is normal to raise rates when the economy is doing well" The Fed has FAILED all these years to hit their inflation targets. That is their self-imposed goal. They raised rates too soon and too fast. They are backtracking. It is NOT normal to raise rates when inflation is significant below your target which is what they did. They have a symmetrical 2% target, which means inflation should be sometimes above, sometimes below symmetrically around 2%. They have NEVER hit 2% under Powell. And he was raising rates. Until the President forcefully called them out on their error.

  128. @Baron95 Nonsense. The Fed was doing what needed to be done, then along came Donnie's trade war...

  129. Speaking as a senior, I really resent the way that I and my contemporaries are being forced to subsidize the economy with these absurdly low interest rates. We are the age group which is most concerned with income from our investments (as opposed to hoping for long-term capital gains, which we won't be around long enough to enjoy). Therefore we would like to be able to invest in bonds and T-bills -- but with these miserable interest rates, what's the point? Now Trump thinks we should even be charged for investing in bonds & T-bills (to say nothing of all the CD's whose interest rates depend on the interest rates that the govt. is paying...). Seniors, when are we going to wake up and start wondering why we should be the underwriters for everybody's else's satisfaction....

  130. @Piri Halasz It’s not like this was hard to see coming. I remember back in 2015 telling as many people as I could that Donald Trump was a terrible businessman, and I also recall a lot of Boomers telling me that I was too young (30 is too young?) to understand the economy. I don’t like being right. I’d much rather have an equitable economy that works for everyone instead of the quagmire we are currently in where the only people benefiting from the market growth is already wealthy people, but here we are. Elections have consequences. My only hope is that seniors vote for the Democrat candidate (whoever that is) in 2020 to regain some semblance of a functioning government again.

  131. @Piri Halasz Are you sure seniors are the underwriters? It seems as though everyone that falls below the much talked about one percent is an underwriter assisting said billionaires with their continued growth.

  132. @Piri Halasz Not just seniors should notice this. Of course, any child alive today is on the hook for paying back Trump and GOP tax "savings" of the TRILLION dollar 2017 tax bill, which gave huge permanent tax cuts to the rich and to businesses -- even as everyday people, some 98% of the population, got a small, TEMPORARY cut. Will kids today notice their future debt, lessened opportunities, and poverty? Knowing as almost all do now that global warming and continued population growth are making the earth uninhabitable-- will kids notice? or vote?

  133. On the positive side, "what's his name" will likely lose millions of votes from the retired folks that depend on CDs, T-notes, bonds and interest to meet expenses. Those options were just barely yielding 2% and now that's gone again. Next they will probably go after SS/Medicare and higher taxes on the old folks.

  134. @Taoshum i would not be so certain... they do not mind pain so long as everyone else suffers

  135. We will never know if this is just Powell caving in to Trump, who has bullied Powell because he needs to offset his disastrous China tariffs, or if there’s suddenly a legitimate need for help. I strongly suspect the former. The economy would be booming but for the tariffs and is still chugging along. If only Yellen had been like every other Fed chair before her and served two terms. But Trump can’t stand women so we lost a great Fed leader.

  136. If you look at the chart it is obvious that over the last 34 years the rate, in both non-recession periods and periods of recession, has been trending downward. This means that the Fed has been boosting the economy through lower interest rates regardless of the economy’s health. Thus the economy has built in an assumption of low interest rates and responds negatively to increased interest rates even if the economy is booming. It also means that when we actually do have a recession there will be very limited ability to boost the economy through lower interest rates.

  137. @Lance Michaels haven’t rates been trending downwards because inflation also has? I’m no expert on the matter, but thought the primary purpose of monetary policy was to keep inflation under control. However, Mr Trump seems to think monetary policy is there to boost asset prices... generating price bubbles, which inevitably end up busting — all this resulting in, who knows, yet another financial crisis. But the great era of 2008 international cooperation is well behind us, so any future financial crisis will be far tougher to tackle.

  138. Trump pushing for lower interest rates represents a big conflict of interest (pun intended). He owns a real estate business, and their single largest cost is loan interest. Lower rates benefits him directly to the tune of millions a year. For some reason, this never gets reported in the stories mentioning him pressuring the Fed to lower rates.

  139. @Danielle Yes, it does, but nobody much cares since they know he's lining his own pockets. His base loves it!

  140. They did it in 2007 lowered the rates and another bad GOP President Bush took us into a very bad recession. Wallstreet was right Trumps recession is coming soon. Good his supporters will reap what they sow.

  141. @D.j.j.k. Unfortunately, so will the rest of us.

  142. The last republican president , George Bush, left us with a Federal interest rate of .25%. That still wasn't enough to stave off the biggest financial crises since the great depression. Trump has proven to be a business man that stiffs his creditors by claiming bankruptcy. I don't know anyone who has claimed bankruptcy once , let alone six times.

  143. 'President Trump, who has been pushing the central bank to cut interest rates to zero — or even into negative territory'. Hmm, I wonder why he is so adamant about getting interest rates low? That would mean borrowing would be cheaper, wouldn't it? And, real estate developers need cheap capital, don't they? I guess being President has advantages when you are a 'successful' businessman. Hmmm.

  144. @Gdnrbob Yeah his rich buddies have to be loving him...first he gives them a huge tax break (which) the middle class will pay for...then he gives the cheap money...

  145. @Gdnrbob I guess he could also refinance his mortgages on his properties.

  146. What Trump wants is a monetary policy that will smooth out or better, negate, the consequences of his terrible trade and fiscal policies for the next 12 months. Does not care what happens once he is re-elected.

  147. Yes, there was a tiny lowering of interest rates. But this is not needed. The Trump Tax Cut took care of all of the financial problems that Trump inherited from Obama! Actually, I am just joking--Obama left a roaring economy, but Trump does not want to admit that. Trump and the GOP gave big tax cuts to the ultra-wealthy and big corporations so they would bring back that money earned outside the USA. The (feeble) hope was that the big corporations and ultra-wealthy would invest in US factories, but an extra yacht, but the big corporations just bought back their stock and gave their executives a big bonus and did not buy a yacht or two or three. Now that boost to the big executive's effective salaries (bonuses and lower tax rates) are over that Trump needs a winner for his (hoped for) reelection. Trump reeally needs this, since as no longer president (a job he is unsuited for), but as an ordinary citizen, he would be indicted for obstruction of justice. And convicted, on the basis of his televised statements.

  148. If Trump's not happy about the cut it must be the right thing. Powell has shown that he is the adult in the room and I hope he stays that way.

  149. @BTO And what room might that be, surely no room for Republicans.

  150. One great worry for economists at the moment is the threat of recession. If we are hit with another recession and we have already bottomed out interest rates, how are we supposed to reignite the economy?

  151. @John That is traditionally done by fiscal stimulus. You know, borrowing at low interest and using the money to employ people. Maybe you forgot since it hasn’t been done too much lately.

  152. It's just so weird how the "strongest, most amazing, beautiful, greatest economy of all time, with historic low unemployment," would necessitate a multitude of rate cuts. It's almost like the economy is only amazing if you are already rich.

  153. @Mike Also, for some people there is no ceiling on their desire for money. They have an endless appetite for money. The economy may be good, but the rich can get even more rich, so they want to push Dow 30,000 and make their fortune. Meanwhile, slashing rates and getting to Dow 30,000 doesn't help the vast majority of people very much. You're right that it mostly helps people who already have a lot of money to invest. Part of what makes the stock market go up is companies being more profitable, which probably means they are not raising wages much. As far as Trump, he just wants easy money like he has had for his whole life. There are no consequences for him being greedy and reckless like there are for so many Americans, including most of his supporters.

  154. For a non partisan independent entity they sure pay attention to a lot of noise...

  155. They threw Toddler Trump a tiny bone for his tiny hands, but not one that will cause harm. If they did what he really wanted the cut would have been substantial

  156. I am no economist. While on one hand - judging from the excellent graph - we are on the cusp of a recession. On the other hand - this move may have stalled it's 8nset by a couple of years. The graph is also powerful in telling us that America's economy has structurally changed - at least as far as rates go. Less than two plus decades back - we were roaring at 6 percent Fed rate. Economists follow trends based on historic data. If Fed suggested a hike - I think the White House will get riled up by a tweeter storm.

  157. Trump super charged big business with his tax cut and de regulation; Big Business can literally do anything they want. What could go wrong?

  158. Even as he insults the Fed Chair, that same chair recklessly takes away normal tools available to the Fed in advance of when they would be most needed.

  159. There is something terribly wrong about Trump criticizing the actions of the Fed. Does this man think he has expertise in everything? This is a person that ignores science. Whether it is economic or physical. He has all the answers. Really? Let's see what happens when the bill comes due on the huge deficit we are running. Let's see what happens when he and his administration are wrong about climate change.

  160. OneSmallVoice, you think they’ll know (or care) when the bill comes due? They’ll be long gone, but trump will be tweeting from the golf course and blaming the next president for messing up “his” fantastic, amazing, incredible, best-in-history economy.

  161. @OneSmallVoice But isn’t it true that they are already wrong? Do they care?

  162. Aside from the millions of dollars he personally saves with every rate cut, Trump must want the interest rate lowered so that the tax payers who’ve been paying for his tariffs and his tax cuts for the wealthy can borrow more money to pay for his next boondoggle and another round of bribes for the farmers.

  163. Hector, Taxpayers are paying the tariffs? Are you sure? Our economist-stable genius president says China is paying them. I’m crestfallen.

  164. You'd be crestfallen if you believed anything he said, and suddenly discovered the truth, but I can tell you don't get your "news" from Fox. Make Apathy Great Again.

  165. @Hector Sorry, but you missed some obvious sarcasm. Rob agrees with you.

  166. This is insane. Lowering interest rates will not stimulate the economy it will actually do the opposite. Many individuals and institutions rely on interest rates as part of their fiscal viability. Older people who do not want the risks of owning stock have money in CDs paying almost nothing. Likewise institutions such as pension funds see their reserves shrink as bond yields drop. All this is doing is propping up a bubble stock market that badly needs a correction. I feel like this is September 1929 and a few of us are frantically shouting a warning that is being lost on the wind.

  167. @Richard Perry So you are 100% correct . There is plenty of money out there as it is. Corporations can get a loan any time it wants. The word bubble is almost taboo right now on the street, but they know exactly what is happening. Squawk box had a guest about a year ago who referenced 1929 have not seen him since. The street keeps saying this is different this time, that it is the consumers who are just buying. Well just like all the other " it's different this time" when the consumer stops guess what, its not different. All corporations did with there tax cuts were to basically buy back stock to inflate there worth, so it is not just the consumer. When they can't refi there debit with the lower rates the ones who are overstretched on the margins will crash.

  168. @Richard Perry Oscar, I didn’t live through the Great Depression but did live with its aftermath. Born in 1941, I became aware that it had wiped out my family’s wealth. We “ used it up, made it do, wore it out”. The lessons learned guided me through life and the Great Recession, and I live modestly to this day. This may or may not be like September, 1929, but I’m prepared for any eventuality. I plan to vote for Bernie Sanders in 2020- none others. All the other candidates, taking corporate cash, will dance to Wall Street’s tune.

  169. Trump doesn't know what he's doing!! His daddy gave him all his $$ interest free, no doubt, or he knew ways to write off the debt, not to mention how many times he declared bankruptcy. He's "leading" our country now and criticizing the FED for having no vision? LOL. Please, Mr. Powell, keep your armor on and don't listen to him!

  170. I hope we get a recession in time to vote the yellow haired idiot out from office.

  171. @MikeG DJI 16,000 by November 2020. Even with Powell FIRED!

  172. our economy burns, Putin dances

  173. Must be tough on the Fed trying to figure out how to counteract whatever stupid thing the president is about to do.

  174. Good boy, Jay, good boy...here’s a bone...got to prop this thing up until a year from November...

  175. So the grifter in chief wants zero interest rates and castigates Fed Chair Powell. The grifter in chief is a disaster. Thanks GOP.

  176. DT, the so-called king of debt, is pressuring Powell to get us to a point of no return. WHEN the recession hits, the fed will have no wiggle room if Trump gets his way. Let’s please vote this disgusting bully of a president out of office in 2020.

  177. Recession on the way. Thx Trump

  178. "No guts, no sense, no vision. A terrible communicator." (It's maddening hearing this buffoon describe competent people this way.) How dare Powell refuse to be another presidential lapdog. I guess not everyone is on board with the one and only administration goal: getting trump re-elected while helping his personal bottom line.

  179. The nest of rationale attributed here to the Fed's cut today is an enormous mishmash of irrelevancies and flat out lies. Typical.

  180. I want to ask Trump, "What's it like to rule over millions of people, the majority of which are much smarter than you? It must be terribly lonely at the bottom."

  181. I could care less whether the "Pres." is happy about this or not.

  182. If you could care less, then you must care a little.

  183. Great to see Powell and the rest hanging touch and showing Trump who's boss.

  184. Evidently, America didn't really take the hint when Trump's casinos went belly-up.

  185. So, according to Powell the economy is strong and unemployment numbers are low.That is good! But wait, there are uncertainties.That is bad! Why doesn’t he just come out and say that Trump’s Trade War is hurting the economy-why doesn’t he say that the chaos that Trump creates on the world stage is affecting other economies.Powell does not say these things because he is part of a Fed which is accommodating Trump and his economic idiocy.For years the Fed has been independent and trusted to run monetary policy with trusted economic models. Under Trump, the Fed has caved and is wiling to go for cheaper and cheaper rates, whether or not they are needed.When rates are zero, what does the Fed do to help an unexpected economic shock?

  186. It’s a shame that yet another supposedly independent body of experts has decided to pander to the president.

  187. The Fed is lowering interest rates as a consequence of uncertainty caused by trump's trade war and he fumes they are not doing enough. Perhaps if trump ended his trade wars and put his twitter phone away it would have the same effect. Try cleaning up your own mess Donnie Boy.

  188. Trump has found the perfect dog to kick when it comes to the economy. What were his grades in Econ in college again?

  189. Fed should not have cut rates. First time the Fed in history with the economy at full employment acted so wimpy. Low rates kill the return on bonds for the retired. At this time every President after Trump should just keep yelling at the incompetent Fed. There was no reason to cut unless they wBt a weaker dollar.

  190. Where was it that Trump earned his PhD in Economics? I forgot.

  191. Trump U, that world-renowned center of academic excellence.

  192. Must have been trump university, that world-renowned center of academic excellence.

  193. Trump obviously doesn't care about anything but himself and re-election. With interest rates low and tax rates low, the next recession will have no tools to combat the downward spiral. This is an omen that wall street doesn't seem to care about. And remember how many of them called the last recession---essentially zero. Interest rates in Europe negative...and low in the US leaves an uncertain horizon--especially with debt beyond ridiculous. Hold on to your assets, it is going to be a wild ride.

  194. Trump tweeted that “It is only the naïveté of Jay Powell and the Federal Reserve that doesn’t allow us to do what other countries are already doing.” naïveté? Has someone hacked Trump's twitter account?

  195. trump has clearly lost all control. This is why the 25th was written.

  196. I don't know why Powell doesn't listen to the great businessman in the White House. After all, that "great businessman" has 'only' put six companies in bankruptcy and lost a BILLION dollars, more than all others put together.

  197. @BigFootMN Correction - The Current Occupant has lost more than any other SINGLE person. But it was over a billion dollars.

  198. If the President weren't throwing wrench after wrench into the gears of the U.S. and world economies, maybe this would never have been "necessary." Please fume into the mirror, which we know you use liberally, Mr. President.

  199. If the economy was doing as well as Trump says it is, the Fed would have raised rates, not lowered them. If Trump really cared about the American People, instead of throwing temper tantrums in the hope of getting to the Fed to help reelect him, he would be leading a serous discussion (sounds crazy right?) about legislation to reform the Fed to make it work for citizens instead of global banks. The only thing Trump cares about at all is Trump. We all know it (and that is exactly why his base loves him). That makes every official decision Trump makes an act of corruption, because the job of president is to execute the law, not self aggrandizement. Trump is a series of High Crimes against the Constitution, which specifically ended rule based on the personal whim of the executive. Trump never made a decision that wasn't based on his whim. List and explain Trump's attacks on the Constitution, which are High Crimes. Stop worrying about Iran, and worry about the true threat to the USA, dismantling Our Republic from the top down. By the way, when the Treasury creates money, to grow the money supply, it belongs to We the People, not global banks. The Fed should decide how much they want to grow the money supply by, and divide it equally between every citizen of the USA. You can't grow the U.S. economy by giving low interests rates to foreign banks that invest in low wage countries or bet it on derivatives. Money in consumer pockets grows the economy and drives investment.

  200. As usual, Trump wants somebody to clean up his mess. If it works, he takes credit. If it fails, he blames them. Has there ever been a more deficient human being as president of the USA? Let’s agree to get somebody with some class in 2020.

  201. @Mike Iker Class would be nice, if I’d settle for literacy.

  202. @Mike Iker Yes. Class, competence and deep usable knowledge please.

  203. Who really cares what donald thinks? If he wasn't whining about interest rates he'd be whining about the media, or the Democrats, or ___________________________________________________. Anytime I want to verify donald's business qualifications I only look at the pics of the Trump Tower and Casino. If I want to seek a source for donald's reasons to advise the Fed I'd start with Deutsche Bank. 1/4 % means a lot to an Oligarch. It's really about that simple.

  204. Trump has "no guts, no sense", no vision about financial markets or much else.

  205. Tax cut causes 1.5 trillion debt, Tariffs cause 30 billion welfare to farmers (just the first of many payments) 6 billion dollar loss to consumers . Just a few of our losses due to the total ignorance of Trump people. Now, he blames the fed for all this disaster by not creating "loose" money?

  206. I am currently reading "The Great Crash 1929" by John Kenneth Galbraith for the 3rd time. Change the names and dates and here we go again. It is sadly funny because we as humans keep falling for the same scam over and over again. I am reminded of a cartoon that showed a diner with a sign in the window that read "Free Lunch $9.99".

  207. @3Rivers "History doesn't repeat, but it often rhymes." - Mark Twain.