Don’t Cut Rates, Cut Spending…Government spending is growing faster than GDP and is projected to reach around 21% of GDP this year, taking resources from the private sector.
Tag Archives: Interest Rates
Don’t obsess about the Federal Reserve. Instead of obsessing about monetary policy, investors should spend their time this year focused on the resilience of the economy. For example, in spite of the partial government shutdown, initial claims for jobless benefits hit 199,000 in the week ending January 19, the lowest since 1969. And auto analysts are forecasting solid sales of cars and light trucks for the month. In other words, the data shows no justification for doom and gloom.
Higher Rates On the National Debt Won’t Cause Debt Spiral. Don’t get us wrong. We’re not happy about the federal debt being so high. In fact, we’d prefer it to be much lower. We’re just explaining that the higher interest rates we’re likely to see in the next few years are not going to generate a fiscal crisis.