Time to raise interest rates?

[Theinquisition]

http://finance.yahoo.com/news/feds-b...144035187.html

ST. LOUIS (Reuters) - St. Louis Federal Reserve President James Bullard said on Friday that cyclical recovery in the economy is largely complete and that he is concerned the central bank is pushing monetary policy "too hard" to address small problems in the labor market.

"It is implausible to cite headwinds when you are six years past the crisis. Whatever is going to happen on a cyclical basis has happened," Bullard said. Bullard opposed the Fed's recent delay in hiking interest rates, a decision that cited continuing headwinds from the crisis and the need for more improvement in labor markets.

So.....He makes a good point, and if the rates stay low for a long time it can result in inflation.

What do you Economic brains of MMOC think? I'm kind of in agreement with him.

[Elim Garak]

Inflation is not automatically bad.

[Ripster42]

Yes, it probably was time to raise interest rates when they last considered it a week ago or so. If for nothing else than to give us some leeway to lower them again when we actually have an economic crisis.

[Theinquisition]

Inflation is not automatically bad.

You're right, a small amount of inflation is good because it is a indicator of growth, however, there comes a point where Inflation can become too much...I think you know this.

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Yes, it probably was time to raise interest rates when they last considered it a week ago or so. If for nothing else than to give us some leeway to lower them again when we actually have an economic crisis.

That would be following sound Keneysian Economic principle, which our gov't doesn't.

Were all good about spending money to stimulate, not so much about paying down that debt when the economy is booming.

[Gheld]

Inflation is not automatically bad.

Inflation is fine if everything inflates at the same rate. Which it doesn't. Which makes inflation completely dumb. People need to get over the delusion that the market is some free and organic entity because it's not, it never has been, and never will be. The belief that it is creates inefficiencies which investors with deep pockets use to skim money out of the market without actually making any meaningful long-term contribution to the rest of the economy. And then despite all their belief that people should be left to their own devices they'll go crying to the guvmint as soon as anything appears to threaten their hoard.

In a purely natural order if ones hoard grew too big for them to defend they would inevitably be forced to choose between defending their immediate well being and defining their hoard. So I can only support a fully free market in a society without law.

[drwelfare]

I feel it should have been done some time back.

[Theinquisition]

Inflation is fine if everything inflates at the same rate. Which it doesn't. Which makes inflation completely dumb. People need to get over the delusion that the market is some free and organic entity because it's not, it never has been, and never will be. The belief that it is creates inefficiencies which investors with deep pockets use to skim money out of the market without actually making any meaningful long-term contribution to the rest of the economy. And then despite all their belief that people should be left to their own devices they'll go crying to the guvmint as soon as anything appears to threaten their hoard.

In a purely natural order if ones hoard grew too big for them to defend they would inevitably be forced to choose between defending their immediate well being and defining their hoard. So I can only support a fully free market in a society without law.

I don't think anyone supports a completely free market.

[Ripster42]

You're right, a small amount of inflation is good because it is a indicator of growth, however, there comes a point where Inflation can become too much...I think you know this.

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Were all good about spending money to stimulate, not so much about paying down that debt when the economy is booming.

Dunno if we need to pay down the debt as much, but increasing the interest rate is fine.

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I don't think anyone supports a completely free market.

There are quite a few forum personalities here that would disagree with you.

[Theinquisition]

Dunno if we need to pay down the debt as much, but increasing the interest rate is fine.

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There are quite a few forum personalities here that would disagree with you.

PAying down the debt a bit important, during times of economic surplus. first because we currently pay quite a bit of interest on the debt that we currently have, without touching the principle, if we pay that down a little at a time, that's less money we have to pay as interest, which results in more money to spend on other things we need, and also will act as a cushion when we need to deficit spend during times of crisis, it would also help keep inflation at bay during times of surplus by taking some money out of the money supply.

[Independent voter]

I thought she was going to raise them last time but then she said she was worried about China, yada, yada.

I bet 20 Internet points she raises them this time.