So the Fed’s board of governors is wrapping up its monthly meeting today, an epic and grueling two-day event wherein the members sat around a big table, ate deli sandwiches, and tried to stretch out the foregone conclusion that they will be cutting rates into two days so they would look busy because none of them wants to go home and have to endure relatives who are visiting for the holidays.
Those of you familiar with “numbers” may already be aware that the federal funds rate currently stands at 1%, the lowest it’s ever been, only having seen this level a couple of times before in the long and storied history of the bank’s target rate. Ben, of course, is all set to drop it lower because that’s just what he does. And can you blame him? Lowering the overnight lending rate has brought us out of a recession every single time he has done it before.
Lolo, ESQ // Dec 16, 2008 at 9:21 am
This is such a smart idea. Once they get to zero there will be no need for any of the fed governors to do anything and they can all just stay at home and watch redtube all day.
Jason // Dec 16, 2008 at 10:04 am
At this rate there will be no interest on anything at all. Money will be left outside banks in large bins, with a clipboard for you to write down how much you took.
Bill G // Dec 16, 2008 at 10:09 am
Nice use of calculus!
Jason // Dec 16, 2008 at 10:14 am
I know, I need to find my calculus teacher from high school and send him a thank-you note because it turns out I actually DID use it again in the rest of my life.
1134 // Dec 16, 2008 at 10:28 am
Those Dedekind cuts may end up in some hyperreal infinitesimal numbers.
Jason // Dec 16, 2008 at 10:29 am
I wonder at what point they’re just going to cut the federal funds rate to i.