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[YAL] – The Recent Interest Rate Cut And Basic Economics

December 16, 2008

According to Yahoo Finance, The Federal Reserve has cut interest rates: 0.00 to 0.25%. Call me crazy, but isn’t this what got us into this mess?

If part of the problem was too much credit, and overbuilding, and not enough savings why are we encouraging the same behavior? By lowering the interest rate you are encouraging people to take out more loans, save less, and over saturate the market?

Another thing, the people running the Federal Reserve are economists, do they not understand the whole business cycle? Do they not understand in order to move forward in a recession you must let the thing run it’s course? It is like a dog with a broken leg, you have to stop and let it heal, you cannot continue to run and damage it further.

What we are doing is hurting the whole economy, we need to stop and think. Ron Paul was right, the next stage in this crisis will be the inflation.  I just wish government will stop making everything worse.

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from Young Americans For Liberty [YAL],

please visit the website!

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