Episode 88: When Is This Year’s “Deficit Day”?
Words & Numbers
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The Federal Reserve's Curse on Interest Rates
The government currently is paying an average of about 2.5%. That's a very nice deal and it's historically low for the same reason that other interest rates are historically low right now. As the federal reserve pushes interest rates down, all interest rates go down, including the one that the federal government pays. And so you've got this strange situation where at some point the federal reserve is going to have to decide whether it's going to come down on the side of the people in controlling inflation or keeping its interest expense low.
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