Will Interest Rates Be Going Down?

| Categories: Interest , Tax

Blog by Fuel Accountants

 

Janet Yellin, our US Treasury Secretary, has once again delayed lowering interest rates. And with good reason. Inflation is still too high. And as I’m sure you know, lowering interest rates has an inflationary effect on the economy.

The biggest problem I see is that the federal government continues to shovel billions of dollars into the economy, creating ever larger deficits, and contributing to the inflation rates.

Although there is a lot of pressure to increase taxes on corporations and the wealthy, anyone doing the math on that will see that the additional revenues that would be generated will not cover the increasing federal spending. 

And as far as taxing corporations, who do they think actually pays that increasing tax? Corporations must create value for their shareholders. When taxes increase, they increase their prices to pay for it.

And by the by, who are the majority owners of our largest publicly traded companies? Not the ultra rich, it’s the pension plans that all us commoners invest in for retirement. So in playing “Robin Hood” with these companies, the feds are, in fact, adversely affecting all the current and future retirees.

Small/Medium businesses and families continue to suffer from higher interest rates and inflation. So brace yourself for this. While I tend to not be a doomsday pessimist, I am a realist about our current national trends. While there is little hope of shrinking our federal government, they need to curb their spending, JUST LIKE THE REST OF US HAVE TO DO!!



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