Will the Federal Reserve, As Rumored, Drop Interest Rates by a Huge Amount??

We are being told that, in an attempt to further stimulate the economy, the Federal Reserve will reduce one of its key interest rates. This after another large reduction just a few weeks ago. Many think that they will drop it a full percentage point which is almost unprecedented. Others think the change will be more limited, though still a substantial alteration.

Question is, will this do anything to stimulate our economy? How about the checks we are all going to get in the next few months? Those will be drops in the bucket and I doubt a $600 tax rebate will do much at all. Perhaps let us pay off a few bills that are overdue, but not much more.

Just like in your own household, the worst time to have financial difficulties is when you have run up a large debt. That seriously limits your resources that could help bail you out. Have you taken a look at our national debt lately. It is at record highs! Now along comes this recession and we have no savings to fall back on and we are in debt up to our ears. So now we will go even further into debt by giving everyone money that we will have to pay back eventually. To top it off, I heard that the government is spending $42,000,000 just to send us letters telling us that we are going to get the money!! Common sense is sorely lacking in Washington at the moment.

In any case, let's wait and see what the Fed does and if it does have any effect at all. I truly hope it does, but guess I have serious doubts that it will.

Comments

[FB]

I would concur that the recent efforts at stimulus will probably not result in any significant improvement in the overall economy but lets just hope that they at least soften the blow for what is liekly to be a serious recession and maybe make it not as bad.