The unintended consequences of the Fed's high interest rate policy

Yesterday, I posted a link about consumer confidence in May. This is a follow up with some additional reflection on the Fed’s role and how its impact is not even across the economy.

“In terms of income, those making over $100K expressed the largest rise in confidence,” Dana Peterson, chief economist at the Conference Board, said in a release. “On a six-month moving average basis, confidence continued to be highest among the youngest (under 35) and wealthiest (making over $100K) consumers.”

Later in the same article:

Wealthy households right now can earn upwards of 4.5% in a high-yield savings account, see their equity portfolios go up 20% in a year, and are watching the value of their real estate holdings rip higher.

These folks want nothing more than for rates to stay high.

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Not this wealthy household.

DB2

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Retirees need these rates. The way that is phrased obscures the topic of economics.

Investors getting good returns, what will METaRs be against next?

We are a funny lot. Last I checked we were looking for returns.

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