This week, the Federal Reserve will be in the spotlight as markets digest where the central bank stands on this rate-cutting cycle. A CNBC survey of economists and money managers showed 80 percent of respondents anticipate another interest rate cut in October, and a narrow majority believes it will be the last rate cut of 2019. The Fed funds market — a key gauge of the direction of Fed policy — shows a 93 percent chance of a 25-basis-point rate cut. Adding greater uncertainty to the mix is whether the Fed will provide greater transparency on its interventions in the
Today, gold surged to a six-year high following signals from the Federal Reserve that rate cuts could be coming as soon as next month. While some believe that a more dovish Fed would be bullish for economic growth, the recent spike in gold prices offers a more cautionary note. RealClearMarkets editor John Tamny explains: To paraphrase the classical economic thinkers whom supply siders have historically (and rather wisely) sided with, gold is the commodity least influenced by outside influences. Precisely because there’s so much gold stock versus new discoveries of the yellow metal, its price is impressively stable. It’s no
Last week, President Trump released a budget plan that was widely praised by conservatives for reining in future spending. However, buried near the back of the budget (page 51) is one item in need of further attention — the Trump administration’s interest rate projections. Under Trump’s budget, interest rates on 10-year bonds are projected to rise from 2.7 percent currently to 3.8 percent in 2027. While the 1.1 percent rise in interest rates over the next decade is in accordance with Blue Chip forecasts (which could explain why the figures were chosen for budgetary purposes), the fact that Trump’s budget
George Gilder is most recently the author the ground breaking The Scandal of Money: Why Wall Street Recovers but the Economy Never Does. He is a founding fellow of the Discovery Institute and a senior fellow at the American Principles Project, which sponsored this book. Gilder is also the author eighteen other well-regarded books including Knowledge and Powerand Microcosm. After the publication of Wealth and Poverty, he became Ronald Reagan’s most frequently quoted living author. In the following clip — from a speech Gilder gave at FreedomFest 2016 — he discusses how near-zero interest rates, far from stimulating economic growth, actually create an
I’m fed up with the Fed too, with its chronic policy failures. A lot of evidence shows the Federal Reserve to be a prime cause of lackluster job growth and sluggishness in wage increases. That said, sometimes a cure is worse than the disease. Now the left, with the support of Hillary Clinton, is threatening to take us, to mix the metaphor, out of the frying pan and into the fire. Last week, about a dozen arch-progressives from “Fed Up” attended a hearing of a subcommittee of the House Financial Services Committee, “Federal Reserve Districts: Governance, Monetary Policy, and Economic
On Monday, Donald Trump stated what is essentially a fact to anyone who follows financial markets — the Federal Reserve has created a “false economy” that has artificially inflated the stock market. Via Reuters: “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
George Gilder, author of The Scandal of Money: Why Wall Street Recovers but the Economy Never Does, recently joined Dawn Bennett on her radio show “Financial Myth Busting” to discuss the continuing economic challenges facing the U.S. and how to overcome them. The key, according to Gilder, is getting our money right. Here’s a taste from the interview: BENNETT: Why does Wall Street recover from recessions, or these types of recessions and Main Street never does? GILDER: Because of the financialisation of the economy, the futile effort to replace production with finance and savings with credit, and it doesn’t work.
CNN recently reported on GOP presidential front runner Donald Trump’s stance(s) about the Fed: [J]ust two days ago, Trump tweeted that he thinks the Fed should be audited. This is something that fellow Republican candidate Ted Cruz supports as well as former candidate Rand Paul. Trump chided Cruz in his tweet for missing a Senate vote on an “Audit the Fed” bill in January. The bill failed 53-44. Trump, in his usual way, by way of baiting his rivals and confusing voters, omitted two crucial points. First, Cruz’s Senate vote would not have led to a different outcome. It would