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View Diary: Republicans vs. Reality on debt ceiling/default (165 comments)

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  •  I'm beginning to wonder (3+ / 0-)
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    Ian Reifowitz, elwior, JerryNA

    If this shutdown and debt scare isn't all an attempt to raise interest rates to sky high levels. The seniors in the republican base are absolutely terrified of low interest rates, and think it gives us hyper inflation, or at least is right around the corner. Can't say for sure what the money part is thinking right now, but no doubt they have a few contingency plans in place for higher interest rates as well.

    Do Pavlov's dogs chase Schroedinger's cat?

    by corwin on Wed Oct 09, 2013 at 08:47:04 AM PDT

    •  Actually the low interest rates are hurting (1+ / 0-)
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      The Fed's insistence on keeping interest rates so low means that seniors -- many of whom are (appropriately) conservative investors who prefer CDs to the stock market -- are earning next to nothing on their savings. That hurts badly. I know people who used to be able to count on say $400 a month in CD interest, and now it's $0.01.

      In a normal market, banks would have to raise interest rates on deposits in order to meet their capital requirements. But since 2008 they have been able to borrow from the Fed at 0%, so they have no reason to pay anything to depositors.

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