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By keeping interest rates at an all time lows do you think the Federal Reserve was acting in the best interest of the country?
Wiki User
∙ 12y ago
WikiAnswers in not necessarily the place for opinions, but since an opinion was asked for...
The Federal Reserve did this country a small disfavor by keeping interest rates low for a long time. This caused an artificial inflation in the value of the dollar that raised the price of a lot of goods (ie: oil) needlessly. This has been going on since Greenspan, although he neither knew it was going on nor acted in malice. The Fed was caught in a hard place with the credit crisis as inflation began to rear its ugly head and banks cried for cheap cash. Rates were already low so the Fed was relectant to lower them for fear of inflation kicking into overdrive. So the Fed was not as prepared as it should have been for the credit crisis. Had they kept interest rates at a much more market-determined level, they would have had a much easier time dealing with the credit crisis (probably making it much more mild than it is now) by drastically lowering rates without fear of a lot of inflation. The Fed did NOT cause the credit crisis by keeping rates low, they merely unknowingly tied their own hands when it came to dealing with it.
Wiki User
∙ 12y ago
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What is the national debt?
The National Debt is the money owed by the US government to the Federal Reserve for printing money. Most of the money that is spent is spent on military and welfare. To see current statistics on the National Debt, see the Related Links to see the National Debt Clock keeping track of the debt in our country.
How do you calculate REPO rate?
I think its a simple interest rate that is calculated and added to the second leg of the transaction. It can be calculated keeping other interest rates in mind & is generally fixed by the central bank of the country.
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Did the south African reserve bank succeeded in keeping its inflation target within the range?
Has the South African Bank failed in keeping inflation within the range of 3 to 6 percent? Discuss
How does the federal reserve use member banks to influence the nations economy?
The foreign policy still concentrates upon keeping the U.S. safe for its citizens. Where it used to focus on containing Communism, now its focus is on combatting terrorism and nation-building. This has led us into wars against Iraq and Afghanistan.
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