ECONOMY/FEDERAL RESERVE/TRUMP AS PRESIDENT: “What if President Trump’s gut turns out to have been right and the Federal Reserve’s interest rate increases are holding back the United States economy? There’s little evidence that the Fed’s rate increases are leading to slower economic growth. But there have been times in the past when higher borrowing costs damped the economy more than the Fed intended. As markets have tumbled in recent weeks, analysts and economists are trying to understand whether that has happened again. And some believe the Fed has already applied the brakes strongly and should back off for a time…How can that be when interest rates are still well below historical levels? It all depends on your starting point. Mr. Bannister contended that the Fed’s main policy rate, the federal funds rate, was in effect significantly lower in the years after the 2008 financial crisis than the actual rate. As a result, the rate has gone up more than might first be apparent.”
–Peter Eavis, “Why Trump Might Be Right About Interest Rates,” The New York Times online, December 6, 2018