But imagine if the federal funds interest rate were to increase to 20%, as it did in 1980. Increasing interest rates to that level would have a devastating impact on business, real estate, the stock market and the entire economy. The annual inflation rate reached a 13-year high of 5.4% in June and July, followed by a slight decrease to 5.3% in August. Like high interest rates, high inflation would be an economic wrecking ball, reducing the purchasing power of both consumers and businesses. More recently, both parties have been negotiating a $1.2 trillion infrastructure bill and Democrats have proposed an additional $3.5 trillion spending bill for entitlements.

Source: MetroXpress October 03, 2021 10:07 UTC