I saw a headline today, Fed just amassing ammo for next recession with summer hike.
At first blush, it seemed to be saying that the federal government was stockpiling ammunition in preparation for an inevitable recession. I further read it to say that the feds were expecting a recession this summer!
That's not what the article meant, though. The article was an explanation as to why the Federal Reserve is increasing interest rates right now, and according to the article, it is to prepare, in the event, that there is another recession in the near future. It's a precautionary move on the Feds' part, according to the article.
What I take from the article is that:
- The government is expecting a recession ... this summer!
- The interest hikes now are so that when (not if) the recession hits, the Fed can, then, lower interest rates
There are a lot of really noteworthy events happening these days with regard to our country's economic health, and while they will tell us that we've recovered from the 2008 Recession, I don't see it. I don't see that anything has improved, and in fact, what I see is the frog in the pot syndrome, where we're just becoming accustomed to the new norm - which is that we're making more money than ever and getting poorer at the same time. Our dollars just don't stretch very far these days.
The fact is that when stores like, Walmart, are doing mass lay-offs, we know that it's bad out there. Walmart used to be the place to get a job when all other job opportunities were dried up.
We're heading into the summer tourist season here in my part of the world, but local Inn keepers are already worried that this will be a bad year for them.
The Feds (probably) aren't stockpiling ammunition for the expected recession, but they are getting ready for what might be a bumpy financial future.
I don't like being a Debbie-Downer with only ever sharing bad news, but I think it is important that we don't look at these headlines and events in fear, but rather as the proverbial canary in the coal mine. If they are accurate and something is coming soon, we have the opportunity, now, to better prepare ourselves for economic upheaval.
But even if nothing happens, being prepared is never a bad idea.