Historically, the signs of a weakening economy have been when the central banks took to lowering the interest rates. As the Federal Reserve prepares to cut the rates while the media keeps telling us the economy is strong, I want you to be prepared for what this could really mean, and warn you once again to not fall for it!
This is a worrisome rate cut, not only because it’s the first one since 2008, but it means the Fed is signaling a slowdown in the economy and they want to keep the bubble inflated and the economic expansion going for as long as possible. Central bank officials are looking to cut rate a quarter of a point citing weaker global growth and trade uncertainty are chilling business investment, which could ultimately weaken hiring and consumer spending, the engine of the U.S. economy.
Officials are also concerned with a lack of inflation earlier this year, when they expected it to reach their 2% target. Anyone who has gone grocery shopping lately knows that that number is being manipulated. The cost of food continues to go up and the dollar loses its value daily. While the Fed paints their rate cut as good for the economy, they are only trying to entice more people to borrow more money, paying it back with interest. How is that good for us? It isn’t…
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Lowering the interest rates makes riskier debt look more appealing to those already leveraged to the hilt, so as I’ve said before, don’t fall for it. Don’t go into debt to hoard more liabilities right now, as the downturn appears to be on the horizon. Never forget that the economy will eventually crumble – it always does.
Jerome Powell, The Federal Reserve’s chairman may also signal another rate cut before the year is up. Lowering the interest rate generally increases consumer spending, although that’s remained high and people are still going further into debt to finance that spending.
If the goal is to create a ripple effect of increased spending, the Fed may get what they want. But they may not, and if consumer spending doesn’t increase, the economy will remain stagnant at best, but will eventually take a downward tumble as the economy’s “engine” stalls. What happens next? Unfortunately, all those individuals and businesses who fell victim to a rate cut and increased their borrowing and spending and liabilities could find themselves in a financial panic when the next recession hits. A downturn always comes and is shadowed by job losses and an inability to pay back borrowed money. It usually comes out of nowhere hitting those who fall victim to lower rates and increased debt the hardest.
Don’t fall for it! Protect yourself and learn to become financially free so that the whims of central bankers don’t cause major money strife in your life!
Governments Have Amassed ungodly Debt Piles and Have Promised Retirees Unreasonable Amounts of Entitlements, Not In Line with Income Tax Collections. The House of Cards Is Set To Be Worse than 2008! Rising Interest Rates Can Topple The Fiat Monetary Structure, Leaving Investors with Less Than Half of Their Equity Intact!
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