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The Federal Reserve just made a move that has financial experts shaking their heads in disbelief. They cut interest rates by a quarter point in September, dropping them to between 4.00 and 4.25 percent. This is the first rate cut since December, and it comes at a time when inflation is still hurting American families.
Charlie Gasparino from Fox Business called this decision the most bizarre thing he has ever seen. He is right to be concerned about what the Fed is doing to our economy. When you cut rates while inflation is still above 3 percent, you are playing with fire.
The timing of this cut makes no sense when you look at the real numbers. Inflation jumped to 2.9 percent in August and shows no signs of slowing down. Working families are still paying more for groceries, gas, and everything else they need to survive.
President Trump had urged the Fed to make a big cut to help boost the economy. But only one Fed governor, Stephen Miran, wanted a bigger half-point cut instead of the smaller move they made. The rest of the Fed seems out of touch with what Americans really need.
What makes this even worse is that the Fed plans to cut rates even more before the end of 2025. They want to drop rates by another half point this year and more next year. This could send inflation through the roof and destroy the savings of hardworking Americans.
The Fed also raised their inflation forecasts for next year from 2.4 percent to 2.6 percent. They know prices are going to keep rising, yet they are still cutting rates anyway. This backward thinking will hurt families who are already struggling to make ends meet.
These rate cuts might help Wall Street banks and big corporations get cheap money. But they will not help the mom trying to buy groceries or the dad filling up his truck to get to work. The Fed cares more about helping the wealthy than protecting regular Americans from rising prices.
This dangerous new territory that Gasparino warned about could lead to another inflation crisis like we saw in the 1970s. American families deserve better than reckless Fed policies that put politics ahead of sound economics. Our leaders need to wake up before it is too late.
