Marketplace Morning Report The rates the Fed does and doesn't control
Jul 25, 2025
President Trump's push for lower interest rates raises questions about the Federal Reserve's actual control over them. Discover how global investors influence long-term rates. Intel faces significant challenges with a major workforce reduction and canceled factory projects, impacting the tech industry. Plus, delve into the complexities of new tariffs on goods from Asia and their implications for international trade, including legal hurdles and shifts in shipping routes.
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Fed Controls Short-Term Rates Only
- The Federal Reserve controls only short-term interest rates, specifically overnight bank loans.
- Long-term rates like treasury bonds are influenced by global investors, based on inflation expectations and Fed independence.
Types of Tariffs and Their Impact
- Tariffs can target specific countries or specific goods worldwide, affecting trade dynamics differently.
- Industry tariffs based on national security or unfair trade practices have stronger legal footing than country-specific tariffs.
Limited Job Gains From Tariffs
- Reshoring production for industries like copper or steel takes years due to capital intensity and automation.
- Increased domestic output likely won't lead to large job gains because of technological advances.