In this video, Ed Butowsky discusses the challenging situation the Federal Reserve is facing. On the one hand, they need to raise interest rates to address the issue of inflation and prevent it from spiraling out of control. However, on the other hand, they must also lower interest rates to stimulate economic growth and prevent a recession.
Butowsky explains that this dilemma has a direct impact on not just your bank but also the wider economy. The decisions made by the Fed can affect the interest rates on your savings accounts, loans, and mortgages, as well as the availability of credit in general. As such, it’s important to stay informed about these economic issues and how they can affect your personal finances.
- The 25 basis point interest rate increase this past week will work towards slowing inflation down, but will also slow the economy down, hurting the regional banks
- Short sellers are inflicting non-systematic damage onto the banks by making a run at them as they see an opportunity with rising interest rates
- Your money at the bank is insured by the FDIC for up to $250,000 per account