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(CNN)   The mother of all interest rate hikes is coming. It can't be bargained with. It can't be reasoned with. It doesn't feel pity, or remorse, or fear. And it absolutely will not stop, ever, until inflation is dead. Or, you know, recession   (cnn.com) divider line
    More: Murica, Central bank, Federal Reserve System, Monetary policy, Inflation, Bank of Canada, consumer prices, South Korea, deep concern  
•       •       •

744 clicks; posted to Business » and Main » on 14 Jul 2022 at 3:33 PM (11 weeks ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook



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2022-07-14 3:14:55 PM  
What really sucks is that last time we had inflation like this, in the early 80s, at least you got good bank interest. I remember having something like 6% on passbook savings.

Now banks want to charge you for the privilege of paying you 0.05%, if you can even get that.
 
2022-07-14 3:22:30 PM  
And yet the interest rates paid on bank deposits/certificates will still be next to nothing.
 
2022-07-14 3:27:33 PM  

ImpendingCynic: What really sucks is that last time we had inflation like this, in the early 80s, at least you got good bank interest. I remember having something like 6% on passbook savings.

Now banks want to charge you for the privilege of paying you 0.05%, if you can even get that.


fragMasterFlash: And yet the interest rates paid on bank deposits/certificates will still be next to nothing.


Don't worry old-timers... the 10%+ savings rates are coming... If you're lucky, they might throw in a free toaster.
 
2022-07-14 3:30:19 PM  
I put money into the treasury. One  of my I series deposits is over 10% interest already. Might as well take advantage, if you've got liquid cash you can live without for a while (which is a shrinking number of people, I understand)
 
2022-07-14 3:31:50 PM  
Isn't peak capitalism so much fun? I'm having fun. Are you having fun?
 
2022-07-14 3:33:32 PM  
Nothing quite like the Fed trying to induce a recession to get millions of people fired to fix a supply problem.
 
2022-07-14 3:34:21 PM  

giantmeteor: Isn't peak capitalism so much fun? I'm having fun. Are you having fun?


No.
😖
 
2022-07-14 3:41:33 PM  
If your basic savings accounts are still paying a small fraction of a percent, it's really time to shop around.

It's obviously lagging inflation and current borrowing rate increases, but my CU bumped standard savings rates to 1.2% today.
 
2022-07-14 3:47:20 PM  

OccamsWhiskers: If your basic savings accounts are still paying a small fraction of a percent, it's really time to shop around.

It's obviously lagging inflation and current borrowing rate increases, but my CU bumped standard savings rates to 1.2% today.


My credit union is doing 0.25%. They'll increase it to a whopping 0.5% if I have over $10k in savings

So... Treasury Direct it is
 
2022-07-14 3:49:20 PM  
Gentle reminder of the stated goal of these hikes is to intentionally increase unemployment and decrease wages because they believe workers have too much power
 
2022-07-14 3:50:14 PM  

NewportBarGuy: ImpendingCynic: What really sucks is that last time we had inflation like this, in the early 80s, at least you got good bank interest. I remember having something like 6% on passbook savings.

Now banks want to charge you for the privilege of paying you 0.05%, if you can even get that.

fragMasterFlash: And yet the interest rates paid on bank deposits/certificates will still be next to nothing.

Don't worry old-timers... the 10%+ savings rates are coming... If you're lucky, they might throw in a free toaster.


What a free toaster might look like

Fark user imageView Full Size
 
2022-07-14 3:51:54 PM  
If Republicans weren't whipping up "AAARRGH, iNflAtIOn!" for the election, we could accept that it's  just temporary due to supply chain problems, rotten weather n places, and Putin's War.

We could weather it easily by not being Whitney little sheep bleating over the price of cabbage. No need to Fark up the whole economy with questionable monetary policy, but I guess that's a feature, not a bug, as far as the GOP is concerned
 
2022-07-14 3:55:05 PM  

ImpendingCynic: What really sucks is that last time we had inflation like this, in the early 80s, at least you got good bank interest. I remember having something like 6% on passbook savings.

Now banks want to charge you for the privilege of paying you 0.05%, if you can even get that.


I got 5.5% on a 1-year CD at some point while in HS, would have been or '00 or '01 IIRC. Saving money was a lot easier back when all you had to do to grow your money was put it in the bank.
 
2022-07-14 3:58:52 PM  

MrBallou: we could accept that it's  just temporary due to supply chain problems, rotten weather n places, and Putin's War.


Yeah, but that's not it. It's 20+ years of idiotic fiscal and monetary policy coming up to bite us all in the ass.

And it impacts the entire world because we're the reserve currency and every other central bank did what we did. (since 2008)

The supply chain thing and Ukraine just brought it to the level quicker than it would have...
 
2022-07-14 4:00:54 PM  

MrBallou: No need to Fark up the whole economy with questionable monetary policy, but I guess that's a feature, not a bug, as far as the GOP is concerned


I understand it's going to cause some pain, and am far too uninformed to understand what exactly it's going to cause. But a fed overnight interest rate of 2-3% is hardly a wild or unprecedented scheme. I think a lot of our pain now is because we should have been there years ago.
 
2022-07-14 4:02:13 PM  
I feel pretty good about locking in a sub-3% fixed.
 
2022-07-14 4:02:44 PM  

ImpendingCynic: What really sucks is that last time we had inflation like this, in the early 80s, at least you got good bank interest. I remember having something like 6% on passbook savings.

Now banks want to charge you for the privilege of paying you 0.05%, if you can even get that.


Your missing part of the picture here. Mortgage rates approached 20 percent in the Early 80's and 10 percent on a savings account was common. I remember getting 12 as a kid
 
2022-07-14 4:05:11 PM  

NewportBarGuy: MrBallou: we could accept that it's  just temporary due to supply chain problems, rotten weather n places, and Putin's War.

Yeah, but that's not it. It's 20+ years of idiotic fiscal and monetary policy coming up to bite us all in the ass.

And it impacts the entire world because we're the reserve currency and every other central bank did what we did. (since 2008)

The supply chain thing and Ukraine just brought it to the level quicker than it would have...


We also have debt to gdp that is so insane. 6.5T of debt to roll over in the next 12 months......going to get real fun. I can't wait for 1t+ a year interest payments.
 
2022-07-14 4:18:44 PM  

Pats_Cloth_Coat: NewportBarGuy: ImpendingCynic: What really sucks is that last time we had inflation like this, in the early 80s, at least you got good bank interest. I remember having something like 6% on passbook savings.

Now banks want to charge you for the privilege of paying you 0.05%, if you can even get that.

fragMasterFlash: And yet the interest rates paid on bank deposits/certificates will still be next to nothing.

Don't worry old-timers... the 10%+ savings rates are coming... If you're lucky, they might throw in a free toaster.

What a free toaster might look like

[Fark user image image 220x331]


Technically a free toaster has a red stripe.
 
2022-07-14 4:24:17 PM  
Aren't businesses making record profits still?

Stop buying unnecessary stuff. Make them bring their prices down.
 
2022-07-14 4:24:44 PM  
They should do more then 100 basis points, nothing is more important then getting inflation down, even if it causes a recession, even if I lose my job or you lose your job. Who would have thought that tossing trillions of printed paper into bank accounts of non producers might cause inflation eh Joe?

In November democrats being hosed out of office will be a start and its going to be epic, and 2 years later you're getting Trump or Desantis, maybe both, either of which is fully capable of taking the heel off the neck of energy producers, which is a good percentage of why prices are so high.
 
2022-07-14 4:28:45 PM  
So the interest rate increase gorilla will eat the inflation snakes?
 
2022-07-14 4:30:09 PM  

Intrepid00: Pats_Cloth_Coat: NewportBarGuy: ImpendingCynic: What really sucks is that last time we had inflation like this, in the early 80s, at least you got good bank interest. I remember having something like 6% on passbook savings.

Now banks want to charge you for the privilege of paying you 0.05%, if you can even get that.

fragMasterFlash: And yet the interest rates paid on bank deposits/certificates will still be next to nothing.

Don't worry old-timers... the 10%+ savings rates are coming... If you're lucky, they might throw in a free toaster.

What a free toaster might look like

[Fark user image image 220x331]

Technically a free toaster has a red stripe.


Well said, fellow fan of the series.
 
2022-07-14 4:31:05 PM  

AsparagusFTW: We also have debt to gdp that is so insane. 6.5T of debt to roll over in the next 12 months......going to get real fun. I can't wait for 1t+ a year interest payments.


Inflation is fantastic for debtors.  You got those dollars back when they bought a lot and are paying them back when they can't buy nearly as much.  Sure, you agreed to pay interest too, but very likely you agreed to an interest rate that is far below what the inflation rate is now.  High inflation is bad for the economy generally, but it will be a godsend for the US Treasury when it comes to paying back debt.
 
2022-07-14 4:31:27 PM  

Moose out front: Aren't businesses making record profits still?

Stop buying unnecessary stuff. Make them bring their prices down.


I too enjoy screaming into the void.
 
2022-07-14 4:34:56 PM  

abiigdog: They should do more then 100 basis points, nothing is more important then getting inflation down, even if it causes a recession, even if I lose my job or you lose your job. Who would have thought that tossing trillions of printed paper into bank accounts of non producers might cause inflation eh Joe?

In November democrats being hosed out of office will be a start and its going to be epic, and 2 years later you're getting Trump or Desantis, maybe both, either of which is fully capable of taking the heel off the neck of energy producers, which is a good percentage of why prices are so high.


I'm trying to find anything in here that makes even a bit of sense.  The best I've got is "November."
 
2022-07-14 5:00:24 PM  

Gonz: I feel pretty good about locking in a sub-3% fixed.


Yeah, 15 years from now whatever you are paying for your mortgage is going to look like peanuts.
 
2022-07-14 5:05:11 PM  

MrBallou: If Republicans weren't whipping up "AAARRGH, iNflAtIOn!" for the election, we could accept that it's  just temporary due to supply chain problems, rotten weather n places, and Putin's War.

We could weather it easily by not being Whitney little sheep bleating over the price of cabbage. No need to Fark up the whole economy with questionable monetary policy, but I guess that's a feature, not a bug, as far as the GOP is concerned


So let's just pretend Republicans were physically incapable of discussing inflation.  How many years do you think you'd be able to claim that before reading reality?
 
2022-07-14 5:06:11 PM  

Uzzah: AsparagusFTW: We also have debt to gdp that is so insane. 6.5T of debt to roll over in the next 12 months......going to get real fun. I can't wait for 1t+ a year interest payments.

Inflation is fantastic for debtors.  You got those dollars back when they bought a lot and are paying them back when they can't buy nearly as much.  Sure, you agreed to pay interest too, but very likely you agreed to an interest rate that is far below what the inflation rate is now.  High inflation is bad for the economy generally, but it will be a godsend for the US Treasury when it comes to paying back debt.


Just bought a car at 2.99%... can confirm
 
2022-07-14 5:13:23 PM  

Uzzah: AsparagusFTW: We also have debt to gdp that is so insane. 6.5T of debt to roll over in the next 12 months......going to get real fun. I can't wait for 1t+ a year interest payments.

Inflation is fantastic for debtors.  You got those dollars back when they bought a lot and are paying them back when they can't buy nearly as much.  Sure, you agreed to pay interest too, but very likely you agreed to an interest rate that is far below what the inflation rate is now.  High inflation is bad for the economy generally, but it will be a godsend for the US Treasury when it comes to paying back debt.


There is a lot of nuance to it. One being the poor get farked since they are not net asset owners and we have to inflate away more than we add over time which farks the poor over.
 
2022-07-14 5:23:24 PM  
When you've reached a point at which the go-to, surefire way to tame inflation is to kick people off the payrolls and kneecap the value of nearly all of their assets, it may be time to stop and consider whether the system itself in inherently and fatally flawed.
 
2022-07-14 5:24:58 PM  

abiigdog: They should do more then 100 basis points, nothing is more important then getting inflation down, even if it causes a recession, even if I lose my job or you lose your job. Who would have thought that tossing trillions of printed paper into bank accounts of non producers might cause inflation eh Joe?

In November democrats being hosed out of office will be a start and its going to be epic, and 2 years later you're getting Trump or Desantis, maybe both, either of which is fully capable of taking the heel off the neck of energy producers, which is a good percentage of why prices are so high.


FYI, TruthSocial is just down the hall to your right.
 
2022-07-14 5:36:47 PM  

NewportBarGuy: Don't worry old-timers... the 10%+ savings rates are coming


This.  Folks in this thread bemoaning the lack of decent interest on a savings account nowadays - that will come, but you are not going to like everything else that comes with those high interest rates.

...and you won't have any money to put in a savings account or CD...

JohnBigBootay: Your missing part of the picture here. Mortgage rates approached 20 percent in the Early 80's and 10 percent on a savings account was common. I remember getting 12 as a kid


This.  You will get the interest on the savings account, but you'll pay the high interest if you borrow for a car or home (or whatever).

Uzzah: Inflation is fantastic for debtors.


This.

NateAsbestos: Just bought a car at 2.99%... can confirm


This guy also can confirm:

Gonz: I feel pretty good about locking in a sub-3% fixed.


You should.  Well done.

...

DrBrownCow: Yeah, 15 years from now whatever you are paying for your mortgage is going to look like peanuts.


Yup, but rents 15 years from now are going to be (insert appropriate metaphor here for the opposite of peanuts).

...

Moose out front: Aren't businesses making record profits still?

Stop buying unnecessary stuff. Make them bring their prices down.


Businesses like the oil companies?  Unnecessary stuff discussed like those in TFA?  Let's cut those out!

i.ibb.coView Full Size


/Few are overly concerned about the inflation on prices of comic books or crochet yarn
 
2022-07-14 5:44:29 PM  

abiigdog: Who would have thought that tossing trillions of printed paper into bank accounts of non producers might cause inflation eh Joe?


Who gave out stimulus money again? Show your work.
 
2022-07-14 6:07:04 PM  

Toxophil: Moose out front: Aren't businesses making record profits still?
Stop buying unnecessary stuff. Make them bring their prices down.
I too enjoy screaming into the void.


It's sure a lot easier than exercising any self-control.
 
2022-07-14 6:20:50 PM  

Codenamechaz: Gentle reminder of the stated goal of these hikes is to intentionally increase unemployment and decrease wages because they believe workers have too much power


Not this time. The work force is shrinking.  A huge cohort of Boomers is retiring.

Unemployment rates is 3.6%.  To get that rate up-to 10%-12% would require something very drastic.  A 1% rate hike isn't going to do it.
 
2022-07-14 6:30:44 PM  
We need price controls. But not with regulations, that would be socialism. We need market-driven price controls.
 
2022-07-14 7:03:32 PM  

neongoats: abiigdog: Who would have thought that tossing trillions of printed paper into bank accounts of non producers might cause inflation eh Joe?

Who gave out stimulus money again? Show your work.


"Work"? Bwaaaaaaaahahahahahahahahahahhaaaaaaaaa!
 
2022-07-14 7:13:18 PM  

Dr.Fey: Businesses like the oil companies?


If only there was a way to reduce one's reliance on gasoline without breaking the bank.  Hmm...

Fark user imageView Full Size


2022 Toyota Camry hybrid with 16" wheels gets 51 city / 53 hwy MPG.
 
2022-07-14 8:13:22 PM  

OccamsWhiskers: MrBallou: No need to Fark up the whole economy with questionable monetary policy, but I guess that's a feature, not a bug, as far as the GOP is concerned

I understand it's going to cause some pain, and am far too uninformed to understand what exactly it's going to cause. But a fed overnight interest rate of 2-3% is hardly a wild or unprecedented scheme. I think a lot of our pain now is because we should have been there years ago.


Janet Yellen was slowly increasing rates until Powell then pushed them lower to 0.75%.
He did this by nationalizing the bank overnight swap market and ordered the fed to buy 100% of the federal budget deficit at 0.75%, far below the natural rate.
This boosted stonks, real estate, and business values bigly.
Yet somehow it's a good idea to keep Powell as fed chair.
There is a poison pill coming, expect Powell to aggressively raise rates ahead of the mid terms, and especially right before the general in 2024 to throw them for the GQP.  He's a financial terrorist.
But as long as voters blame Biden he's good.
 
2022-07-14 8:19:46 PM  

Dinjiin: 2022 Toyota Camry hybrid


Buying a $28,000+ late model car may not provide substantial savings for most folks, even if gas prices remain high for the next five years.
 
2022-07-14 8:43:23 PM  

BMFPitt: MrBallou: If Republicans weren't whipping up "AAARRGH, iNflAtIOn!" for the election, we could accept that it's  just temporary due to supply chain problems, rotten weather n places, and Putin's War.

We could weather it easily by not being Whitney little sheep bleating over the price of cabbage. No need to Fark up the whole economy with questionable monetary policy, but I guess that's a feature, not a bug, as far as the GOP is concerned

So let's just pretend Republicans were physically incapable of discussing inflation.  How many years do you think you'd be able to claim that before reading reality?


If a Republican was President, we'd be hearing how booming the economy is

They lie
 
2022-07-14 8:59:31 PM  

MrBallou: If a Republican was President, we'd be hearing how booming the economy is

They lie


Yes, they would.  They would be telling the exact same lie you're trying to tell.
 
2022-07-14 9:01:31 PM  
Jesus H Christ, just rip the band-aid off!
 
2022-07-14 9:28:13 PM  

BMFPitt: MrBallou: If a Republican was President, we'd be hearing how booming the economy is

They lie

Yes, they would.  They would be telling the exact same lie you're trying to tell.


go fishing somewhere else
 
2022-07-14 10:21:07 PM  
Hearing the AFL-CIO chief economist's take on this on the radio this morning, since he's one of the few economists you'll find who isn't grabbing his sausage at the idea of worker wage growth being obliterated, it's convinced me that the Fed is looking for a recession. They've laser focused on wage growth as being the cause of inflation, ignoring the war in Ukraine, the supply chain issues, or even just plain old corporate greed. The banksters that are controlling Jerome Powell like a sock puppet want to get back to their endgame of making it too expensive to live, to force us all into company towns and use us up as literal slaves, and wage growth is anathema to that. They can't stand it. So because they'll never feel the effects of the economy going into the toilet, they're trying to hold a pillow over its face until it just dies.

Eat the goddamned rich.
 
2022-07-14 11:22:40 PM  

OccamsWhiskers: MrBallou: No need to Fark up the whole economy with questionable monetary policy, but I guess that's a feature, not a bug, as far as the GOP is concerned

I understand it's going to cause some pain, and am far too uninformed to understand what exactly it's going to cause. But a fed overnight interest rate of 2-3% is hardly a wild or unprecedented scheme. I think a lot of our pain now is because we should have been there years ago.


We partied harder than we should have and now we will deal with the hangover.
 
2022-07-14 11:28:57 PM  

mcreadyblue: Codenamechaz: Gentle reminder of the stated goal of these hikes is to intentionally increase unemployment and decrease wages because they believe workers have too much power

Not this time. The work force is shrinking.  A huge cohort of Boomers is retiring.

Unemployment rates is 3.6%.  To get that rate up-to 10%-12% would require something very drastic.  A 1% rate hike isn't going to do it.


This.

I work in procurement, a lot of people decided to finally retire or retired early due to the pandemic.
 
2022-07-15 12:50:53 AM  

Dr.Fey: Dinjiin: 2022 Toyota Camry hybrid

Buying a $28,000+ late model car may not provide substantial savings for most folks, even if gas prices remain high for the next five years.


That's going to be true of almost any vehicle, new or used, given the current market.  But supply chain issues will eventually work themselves out and prices will begin to drop.  Then it becomes a question as to if the higher price of a hybrid powertrain is a worthwhile hedge against higher fuel prices when you make your next purchase.  It will eventually pay for itself, but some folks may want to park their money elsewhere if it takes 80K miles versus 40K for a new one.

Of course, there are other ways to save on fuel.  But they may require sacrifices that some people aren't willing to make.  They'd rather blame Biden.
 
2022-07-15 1:13:45 AM  

Northern: OccamsWhiskers: MrBallou: No need to Fark up the whole economy with questionable monetary policy, but I guess that's a feature, not a bug, as far as the GOP is concerned

I understand it's going to cause some pain, and am far too uninformed to understand what exactly it's going to cause. But a fed overnight interest rate of 2-3% is hardly a wild or unprecedented scheme. I think a lot of our pain now is because we should have been there years ago.

Janet Yellen was slowly increasing rates until Powell then pushed them lower to 0.75%.
He did this by nationalizing the bank overnight swap market and ordered the fed to buy 100% of the federal budget deficit at 0.75%, far below the natural rate.
This boosted stonks, real estate, and business values bigly.
Yet somehow it's a good idea to keep Powell as fed chair.
There is a poison pill coming, expect Powell to aggressively raise rates ahead of the mid terms, and especially right before the general in 2024 to throw them for the GQP.  He's a financial terrorist.
But as long as voters blame Biden he's good.


I think this is a bit too conspiratorial. Powell is simply an idiot.
 
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