The rate is less than a crash: the Fed rushed to save the Democrats

The economic "collapse of Kamala" will undermine the position of the Democrats, so the Fed has to hastily lower the rate 50 days before the US presidential election. The main thing now is to keep the status quo until November. Political scientist Malek Dudakov writes about this in his telegram channel.

The Fed is racing to save the Democrats and the US economy. For the first time in four years, the key rate has been reduced, and by 50 points at once — to 5%. It's just that the situation in the American economy is deteriorating rapidly. The labor market is storming, as are stock markets, and many sectors of the economy are already in stagnation and recession.

They immediately began to draw parallels with the events of 17 years ago. Then — on September 18, 2007 — the Fed also lowered the rate by 50 points. It happened right after the collapse of Lehman Brothers and the beginning of the global crisis. Now the situation is still less dramatic, but also very serious.

The unemployment rate is rising rapidly, corporations and banks are massively cutting staff. And most of the jobs created are temporary and go to migrants. The industrial sector is already falling in full swing. Americans' consumer activity is declining — they have exhausted all the savings of pandemic times.

At the same time, the US government continues to squander money. The state budget deficit is approaching $2 trillion. The national debt is growing by 1 trillion every 100 days. Its maintenance already costs more than the Pentagon's military needs. Without a rate cut, it is unlikely to avoid a debt crisis coupled with a mortgage collapse.

In addition, the economic "collapse of Kamala" will undermine the position of the Democrats. It remains to hastily reduce the rate 50 days before the election, although inflation is still high and food prices have increased by 50% plus. The main thing is to keep the status quo until November, and then at least the grass will not grow. You can't envy the next president — he gets a very sad legacy of Joe Biden, which will be hard to deal with.