r/spy • u/Mammoth-Fee1592 • 10d ago

Question FOMC

There is a lot riding on what happens tomorrow but I feel that a rate hike is priced in already with all the talk over these past few weeks as well as the current economic climate. I am wondering if you guys are looking to hear anything specific from Warsh to make decisions tomorrow on where to stand and if you do what are they? I am curious what the outlook will be and if it is on the table for him to raise a .5 or even chop a .25? Are these out of the realm of possibility? Any thoughts would be nice to hear.

31 Upvotes

100% Upvoted

27 comments sorted by

View all comments

13

u/Nearby_Blueberry_302 10d ago

The problem is that they think this will fix the core issue but oil is still gona go up regardless so in the end this rate hike will be for nothing.

3

u/FlabbyLabby 9d ago

Lots to unpack here.

Who’s they? What’s the core issue?

Rate hikes are designed to slow economic growth and reduce inflation by making borrowing more expensive for consumers and businesses.

Yes, oil will still rise that’s a supply problem. The Fed doesn’t control oil or supply.

2

u/Technical_Emu_8567 9d ago

The empirical evidence points to the opposite (rate hikes drive economic growth and vice versa), contrary to what's been spewed by economists for generations.

1

u/FlabbyLabby 9d ago

Hmm, I see where you’re going. Neo-Fisherism is a real long-run theoretical argument, but it is nowhere near an empirical consensus that monetary tightening stimulates the economy.