Federal Reserve Cuts Rates for First Time in 2025
It’s about time.
Welp, it only took numerous poor inflation reports for the Federal Reserve to cut interest rates!
From Fox Business:
Following the central bank’s decision to cut rates for the first time since December 2024, the federal funds rate will sit at a new range of 4% to 4.25%. The cut comes after the Fed left rates unchanged at its first five meetings this year amid economic uncertainty.
Policymakers have been monitoring economic data which has shown a slowdown in hiring as businesses grapple with shifts in trade and immigration policy, while inflation has remained elevated and trended higher in recent months as tariff-related price hikes filter through into inflation data.
That dynamic has presented a challenge for policymakers in achieving both of the goals of the Fed’s dual mandate to promote maximum employment and stable prices in line with the Fed’s 2% inflation target.
It’s ridiculous that the Federal Reserve has this much monetary power.
End the Fed.
Federal Reserve Chairman Jerome Powell said:
We think it’s appropriate that that we reduce our rates so that we become more neutral. Which will be which presumably will be better for the labor market. You You see people who are sort of more at the margins, so kids coming out of college and younger people minorities are having a hard time finding jobs. The overall job finding rate is very, very low. However, the layoff rate is also very low. So you’ve got a low a low firing, low hiring environment. And the concern is that if you start to see layoffs, the people who are laid off won’t, there won’t be a lot of hiring going on so that could very quickly flow into into higher unemployment.
Okay, so you should have done this in July.
BREAKING: Federal Reserve Chairman Jerome Powell says lowering interest rates will help a struggling labor market, where some people are “having a hard time finding jobs.” pic.twitter.com/lPEATvistS
— Fox News (@FoxNews) September 17, 2025
The thing is, the Fed cut rates by 50 last September and continued to do so until former President Joe Biden left office.
So why the caution now? Powell doesn’t have an answer:
There wasn’t widespread support at all for a 50 basis point cut today. You know, I think we’ve done, we’ve done very large rate hikes and very large rate cuts in the last five years, and you tend to do those at a time when, when you feel that policy is out of place and needs to move quickly to a new place. That’s not at all what what I feel certainly now, I feel like our policy has been doing the right thing so far this year, I think we were right to wait and see how tariffs and inflation and the labor market evolved. I think we’re now reacting to, you know, to the much lower level of job creation and other evidence of softening in the labor market, and saying, Well, those risks are maybe, maybe not fully balanced, but moving in the direction of balance now, and so that warrants a change in policy so.
“There wasn’t widespread support for a 50 basis point rate cut today,” Fed Chair Powell says, adding: “You tend to do those at a time when you feel that policy is out of place and needs to move quickly to a new place. That’s not at all what I feel.” pic.twitter.com/eV1cmRMyB0
— Yahoo Finance (@YahooFinance) September 17, 2025
[Featured image via YouTube]
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Comments
Are we not men?
We are DEFLO!
Seriously, dude, you look like an adult toy.
It’s mandatory gear on the stock exchange floor, in case of a crash.
End the Fed, indeed.
Enough big government already.
Wow- finally budged from Biden’s cooked data, by a whopping quarter point.
It should have been a half point.
Crooks or idiots…. either way, time to end the fed.
The Fed is doing the right job. It’s not actually setting interest rates except as a way to get the right money supply. Interest rates rise when they withdraw dollars from circulation, and fall when they add dollars to circulation. “Setting the interest rate” is really deciding whether to add more or subtract more dollars from the economy, which is what’s going on in the background.
They decided to add more dollars (or withdraw less dollars), which will add to inflation but also keep the economy from going idle. Mixed goals.
Dollars at the national level are not wealth. They’re tickets in line to say what the US economy does next, presumably something for you. The Fed is judging whether there are too many tickets bidding up prices for what the economy can do at once, or too few tickets to keep all of the economy busy. and creates or destroys tickets.
Gold can’t do that.
Inflation is the increase in money supply. M2 increased by 3.9% in 2024 and so far in ’25 is increasing at an annualized rate of 4.4%. Putting more $ into the economy from increase via printing/magic v inducing savers off the sidelines to move into investing is itself inflationary. Every ‘new dollar’ created by the Fed devalues the purchasing power of the existing dollars by an equivalent amount.
Too much money sloshing around in the economy can be identified by asset valuations increasing to Cray Cray levels. Stocks are vastly over valued, CAPE valuation is at/near record. Real estate, particularly commercial property, is likewise way over inflated.
We need higher rates, not lower. Higher rates allows a viable alternative to TINA (there is no alternative) equity and real estate to gain a positive real rate of return. This has the benefit of helping Mom/Pop v financiers as well as putting stress on gov’t borrowing and mal investment in the broader economy.
A cartful of groceries, a new car, or a new house costs roughly the same in weight of gold today as it did in 1900. Fiat toilet paper can’t do that.
Best news the economy has had this week.
more money slushing around that has been manufactured vs created by wealth etc
well..its not like we’re in debt or anything
and pleazzzz spar us the
but it cost less to pay off the debt with lower rates…blah blah
sure…but it also signals not only politicians but also the race baiting welfare seeking comrades to demand more from the somewhat beleaguered middle class
those who say…we;; we’re stuck with the fed
wrong.. we are not
a maga agenda and a congress not afraid to ignore welfarers pleas,,,can do it
then the dnc can start to pay directly for allll those people they claim they love…school…healthcare etc its no more impossible than the red sox having finally won the ws years back..not to mention the cubs
The 401k dropped $3k over the last 24 hours. Silver and Gold has done well.
I do not have much Silver and Gold. I have about 20 pounds of junk silver US coins with most being dimes. There is the handful of collectable coins. I have a couple of 5 troy oz bars I bought back when silver was less than $6 an oz. The little bit of gold I have would buy a base F250 Superduty 6.7L Diesel. The silver would bump it up to a Lariat trim level.
This would have happened 6 months ago if Powell weren’t playing politics
The FED obviously weaponized, politically.
Powell gotta go.
“I think we were right to wait and see how tariffs and inflation and the labor market evolved…”
While I agree that the Fed could safely have done this at the last meeting, and while I don’t deny that the Fed is politicized, I do understand their hesitation to move too rapidly.
As it turns out Trump seems to have been right so far with his tariff bazooka and the expulsion of (?) two or three hundred thousand (?) unskilled laborers has not apparently hurt the economy. However I think it is fair to argue that there are no precedents for either of those things, and therefore no sure way to project the consequences, positive or negative. In such circumstances a slower approach is a wiser one.
One can argue for the elimination of the Fed, but at present it exists and its role is projecting the aura of a measured moderating influence on the market. It is fulfilling that role, and that is part of reason the world economy runs on nice, green, predictable dollars.
since I am biased against the fed………
“and that is part of the reason ..nice green predictable usd
wont agree with you on that
the usd would no doubt be the de facto currency b/c we are capitalists and have a huge economy to back that up
so yes,,if china turned at least 50+% capitalist ( as our lefty run economy moves further left) the yuan/renminbi would have a legit reason to be the choice