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You actually think low interest rates are a good thing?

Low interest rates are the hallmark of an economy in serious trouble.

Low interest rates are not economically viable long term.

They are kryptonite to many types of pensions, funds, retirement funds and insurance companies.

There are massive global economic problems.  The world still hasn’t dealt with the 2008 derivative bomb.

Deutsche Bank just got out of the derivatives game globally the other week.  They were the biggest financial player in the derivatives game.  What do they know that we don’t?

Lowering rates means the Fed has no other options left to combat an economy that is slowing down.

This shit happens almost like clockwork every 7-10 years.

As much as I prefer Trump to any other options, he has 0 influence over the decisions of the Fed.

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And in a strong economy can cause inflation, I don't really feel it's a great sign.

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If they drop a quarter point, that's probably enough now for me to bother with a refinance on the main house.  I approve.

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So remember kids, "The economy slows because of the government, the economy grows in spite of the government."

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Say what? Gray bars are recessions.

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I think they keep rates the same.

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The president has no business “calling out the federal reserve”.   They operate independently, he needs to stay in his lane.

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I'm going to condense this down as much as possible so a lot of detail has been omitted for the sake of brevity.

Interest rates in natural terms can be thought of as their own pricing signals (the price to purchase money which is what a loan ultimately is).  Interest rates are a signal for entrepreneurs and others when it is time to invest or borrow and when it is time to save.  High interest rates are a signal that it is time to save and to borrow less.  Low interest rates are a signal that it is a safe time to invest or borrow.  Now this does not mean that all investments will pay off as nothing here establishes or overrides personal decisions.  This artificial lowering of the rates encourages reckless investment that will ultimately result in a bust.  High interest rates curb investment due to the cost or rather, encourage more cautious investment or borrowing.  Actors are far more cautious about investing or borrowing under high rates whereas low prices on borrowing or investing encourage it.  This is the basics behind the 2008 housing crisis.

Boom and Bust cycles are healthy economic cycles but a lot of actors such as the Fed or other authorities seek to avoid the bust thinking that artificially lowered interest rates will keep the boom going.  The reason a boom is good should be obvious, but a bust is not so obvious.  A bust does hurt, there's no way around that, but it is a self correcting process.  A bust allows those that misappropriated resources and put them into unstable efforts to fall by the wayside and allow for other more stable endeavors to rise.  You can think of it like getting injured.  It sucks and it hurts, but it teaches you what not to do.

ETS:  Think of Boom and Bust as good decisions and errors.  Several small busts are normal (such as some restaurants going under here and there).  A Bust period however is far more substantial and is a cluster of errors.  These "errors" in real terms are basically businesses screwing up and hitting hard times.  This is can either be simple change sin the Market (people's purchasing decisions) and/or bad decisions made by business owners that result in their hard times.  Artificially trying to keep these zombie businesses going ultimately ends up extending the bust period (Ex. Bailouts) instead of letting it happen, take the pain, and move on.

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I think it is a balancing act, Like @Jackal_39 said......too low bad, too high bad, somewhere in the middle is a good spot.
But, from what I have seen it can go in cycles. So, someone has to play with shit all the time. Still funky.

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I got it the exact same way you posted it, both times.

It a cycle no matter what, committing the finer details of variables. Toss in a bunch of moron lever thowers that dont need to be there anyways.

Like I have said, I see the results in the trenches (trucking). and see it like an ordinary piss ant. I also have learned the following steps:

Truck slow down
someone tries to make it better
People feel the sting
Someone tries to make it better
people buckledown and ride out the storm
someone tries to make it better
people start doing what they do best, and start sumping the boat in order to survive
someone tries to make it better

Trucks pick up the pace, freight tonage increases...then we do the opposite as above, except:
someone tries to make it better.....this stays the same

someone tries to make it better = level throwers.

Now I am sure you have a more detailed and technically correct terminology, but the view is still the same.

I see these cycles happen about every 7 to 10 years......maybe a bit less. Some of "why" I dont get, but I take it "thats the never ending cycle"

I dont think there is ANYTHING  that does not move in a circular cycle.

Cycles are the basis of everything. Why would an economy be any different?

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It’s already possible I’m the last homeowner in America to not refinance since 2010.

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A rate cut is a tantamount admission the economy is slowing and needs to be propped up to prevent recession.  Once the expected news happens there will probably be a sell off now that expectations have been met.  The only expectations left to meet is some kind of end to the trade war with China, which is unlikely, because the Chinese know the trade war is hurting the US economy and thus Trump's re-election prospects.  The CCP starved 50 million people to death in order to implement its goals.  They aren't going to back down on a piddly trade war if it means getting rid of Trump. They can't be dislodged because of a bad economy.

BUT, no rate cut will cause a stock market rout because it was expected but didn't happen.

Kind of a no-win situation. Especially at all-time market highs.  But the best course would be to do what was expected. At least a .25 cut.

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I just closed on my refi. From 6.1% to 4.2% I’ll be saving over $300 a month. I’m just happy I finally have some equity I’m my house after 10 years of owning it.

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I bought my house last year at around 5%. I could get around 4.2%. Mortgage guy says I should refinance. Is be blowing smoke?

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lol

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Uhhh...cutting rates is going to increase the velocity of money. DJIA 30k will be the next significant support level once the rates change. After that, who knows. Making money cheap to borrow is good for business.

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And we can't have interest rates completely determined by the free market because?

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The huurrrrrr-slllluuuuuurrrrrrr-derrrrrrp is strong in this thread.

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Dumb question,  but what does one do to be prepared? I have been putting money in my 401 and paying off as much debt as possible. I pay cash for everything now...if I can't afford it,  I dont buy it.

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Depends what you have to lose. If nothing, perhaps take as much debt as you can get now and see what happens.

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And we can't have interest rates completely determined by the free market because?

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And we can't have interest rates completely determined by the free market because?

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What would you recommend we do to prepare?  The cut is coming in the next couple weeks, probably .25 to .5 .  Market will respond positively, so is it time to buy?  Stock market is too high, but I said that 2 years ago and lost out.  I said that 1 year and bought, so I've seen some increases.