This week, CCIV, a global news search engine, released their monthly report on the economy, showing that the U.S. economy grew at an annual rate of 2.5% in the fourth quarter of 2011. Overall, job growth was less than expected, and the unemployment rate declined by 0.3%.
At the end of last year, the Federal Open Market Committee (FOMC) was expected to announce its first rate hike for the year. However, in the middle of February, the committee raised the target for the unemployment rate to 4.0 percent. The reason for this was a survey showing that the job market was still fragile, and that the committee had to find a way to make up for the slack.
When you talk about “loosening” your belt, you inevitably talk about the Fed. And when the Fed raises interest rates, it doesn’t simply make the money you use to buy stocks go up. It actually makes your investments go down. I recently bought shares in a company whose stock I was tracking because I thought it had potential to rise in the near future (it was a company I could do a lot of research into). When the stock dropped to $3.
The good news is that, since the stock’s drop, the stock has risen. The bad news is that the Fed raising interest rates actually makes you go down. In a sense, it just means that the Fed (and central bankers generally) have no idea what they’re doing or why they’re doing what they’re doing.
The funny thing is I don’t think that it’s that the market is doing anything at all, but that the markets are doing something and that the only thing they’re doing anything at all is making me think I might be wrong.
As it turns out, the Federal Reserve isn’t the only one who makes you go down. It’s a bit of an odd thing when you think about it; the Fed is the one that’s doing all the thinking. The Federal Reserve is the one that’s telling us what to do, and it says what we should do. The banks that are holding your money are the ones that are deciding what to do, and they are the ones who are deciding what to do.
Thats a bit of a strange way of looking at things. You think of the Fed as a think tank of sorts, right? Well, instead of having a thought, the Fed is actually acting on a thought. They create money and they create money out of nothing. Thats the way the money works in the modern world. The Federal Reserve is actually acting on a thought, like a thought police.
There is some truth to what you say. The Federal Reserve is not a think tank of sorts, it is an institute of money making. It is not a think police, it is a thought police.
The Fed is really a think police. The Fed controls the money, not the people. The Fed is a thought police because it can manipulate the minds of individuals by creating money out of nothing. In other words, the Fed is not really acting on a thought, they are actually acting on a thought police. It is a thought police because the Fed is actually thinking about the thoughts of the people who are currently in charge of the Fed.
This is not to say that Fed money is bad. It’s just that we can’t expect those in charge to act, well, think logically at the same time.