Will The Federal Reserve Screw Us?

I mentioned this in a thread earlier but Ive been thinking about this quite a bit.

The Federal Reserve needs to either raise or lower the interest rates. If they keep it as it is the Dollar AND the US economy will suffer. If they raise the rates it will save the Dollar from sliding even more into the abyss against other currancies. But it will also trash the economy or at least make it worse.

If they lower the interest rates the Dollar will slide even furthur and make the it weaker. Forigen folks will buy even MORE of our country!! But if the Fed Reserve lowers the rates it will ease the pain from a weakening US economy.

What should THEY do? What would YOU do?

Rates need to go up, or inflation is going to explode.

They have already screwed us. They never should have let the dollar get so low and shouldn't be bailing out the likes of Bears Strearns (sp?).

DaveNay said:

Rates need to go up, or inflation is going to explode.

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PBinWA said:

They have already screwed us. They never should have let the dollar get so low and shouldn't be bailing out the likes of Bears Strearns (sp?).

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Why don't both you guys run on your own ticket ??? Hell I'll vote for you guys

I agree with them too Al. We need to raise the interest rates 3 points.... NOW!!!!!! God

PBinWA said:

They have already screwed us. They never should have let the dollar get so low and shouldn't be bailing out the likes of Bears Strearns (sp?).

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Yup. The real question is "will they continue to screw us?"

Cityboy said:

Yup. The real question is "will they continue to screw us?"

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Actually, I would change my original statement from letting the dollar get so low to allowing interest rates to get so low. I think the low interest rates are part of the problem - it's too easy to borrow money. A low valued dollar may not be that bad of a thing. I think we can afford slightly higher costs of goods even though it may impact our lifestyles (which in my opinion are pretty excessive at the moment).

And to answer you CB, yes the Fed will continue to screw us.

No politician has the balls to lie to the American people and promise them the world and then once elected reneg on those promises and do what needs to be done. The sad thing is that you need to get around 300 politicians (including the President) elected that care more about the country than their careers - fat chance of that.

We saw the kind of support that an honest politician like Ron Paul got.

Deadly Sushi said:

I mentioned this in a thread earlier but Ive been thinking about this quite a bit.

What should THEY do? What would YOU do?

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This is an election thing that "will" bite the Dem's in the butt.

To get elected at the president level they were preaching that the economy under Bush was in the dumps when nothing was wrong, but they said it enough that people began to believe it and started to save money instead of spending it.

From there stores didn't have the sales and they laid people off, from there it went out like a wave. People at the top end of the job list started to have companies lay them off or cut pay and they couldn't afford to pay for houses they bought on "Floating Interest Rates" and they got to where they couldn't afford them and they went into foreclosures. The mess is compounded by the Government (Democratic controlled congress) bailing out the companies that gave the loans to people that can't afford them...

It goes on and on, all in the name of politics... Oh, and the price of oil, remember when Clinton veto the drilling in ANWR, that was suppose to be ten years to market, that would have been about now if that was the case, but again, you can blame the Democrats for blocking that too. It would have been about another million barrels a day over what we have now since the Pipeline is able to do 1.2 million barrels a day but is currently about .3 million, big difference. The fact that we are giving our money (Wealth) by the Billions to other countries for oil isn't helping either when we have plenty here.

If the word "Federal" is in there then the answer to your question is YES.

Bend over everyone. The feds taken some more viagra and wants to take another round out of us:

http://biz.yahoo.com/nytimes/080711/1194793612725.html?.v=4

U.S. Weighs Takeover of Two Mortgage Giants
Friday July 11, 12:35 pm ET
By STEPHEN LABATON and STEVEN R. WEISMAN

WASHINGTON — Alarmed by the growing financial stress at the nation’s two largest mortgage finance companies, senior Bush administration officials are considering a plan to have the government take over one or both of the companies and place them in a conservatorship if their problems worsen, people briefed about the plan said on Thursday

... more at the link above.

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Oh this is just great, not only is the Fed going to screw uis some more but they are going to let the Chinese in on the action . . .

http://www.marketwatch.com/news/story/chinese-government-top-foreign-holder/story.aspx?guid=%7B347DF7BF-F0B7-48C9-A418-5A0B903D9F72%7D&dist=hppr

Chinese Government is Top Foreign Holder of Fannie Mae, Freddie Mac Bonds

$376 Billion in Chinese Agency Bond Holdings Subject to Taxpayer Bailout Proposals According to FreedomWorks Analysts
Last update: 11:08 a.m. EDT July 11, 2008

WASHINGTON, Jul 11, 2008 (BUSINESS WIRE) -- As politicians call for taxpayer bailouts and a government takeover of troubled mortgage lenders Freddie Mac and Fannie Mae, FreedomWorks would like to point out that a bailout is a transfer of possibly hundreds of billions of U.S. tax dollars to sophisticated investors and governments overseas.

The top five foreign holders of Freddie and Fannie long-term debt are China, Japan, the Cayman Islands, Luxembourg, and Belgium. In total foreign investors hold over $1.3 trillion in these agency bonds, according to the U.S. Treasury's most recent "Report on Foreign Portfolio Holdings of U.S. Securities."

FreedomWorks President Matt Kibbe commented, "The prospectus for every GSE bond clearly states that it is not backed by the United States government. That's why investors holding agency bonds already receive a significant risk premium over Treasuries."

"A bailout at this stage would be the worst possible outcome for American taxpayers and mortgage holders, who have been paying a risk premium to these foreign investors. It would change the rules of the game retroactively and would directly subsidize the risks taken by sophisticated foreign investors."

"A bailout of GSE bondholders would be perhaps the greatest taxpayer rip-off in American history. It is bad economics and you can be sure it is terrible politics."
SOURCE: FreedomWorks

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This NOT good news. These United States are going down with other countries buying her out.