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A little Planet Money fix this morning on the Fed and interest rates...

"Last week, policymakers at the Federal Reserve voted to bring interest rates down. Down! That's despite a decade of economic growth, record low unemployment, solid corporate profits, and a good stock market. And it's despite the fact the federal government has already been juicing the economy with big spending and tax cuts. In the old days, the Fed would be worried this would all make the price of everything explode (inflation), and they would be voting to *increase* rates to slow things down. But, no. They're putting their foot on the accelerator...

The main way the Fed influences interest rates is very narrow, usually through a policy lever known as the federal funds rate. It's the rate banks charge each other to borrow money overnight. By making it cheaper for banks to borrow, it makes it cheaper for businesses and households to borrow. That is the traditional way the Fed has tried to boost the economy. It injects more money into the system.

The federal funds rate is an important interest rate, and it influences other interest rates — on mortgages, business loans, credit cards, etc — in the short term, but the Fed's power over interest rates in general is very limited. The market ultimately determines real interest rates, not the Fed...

The Fed can grease the wheels of the economy with cheaper credit, and it can help guide it in a better direction, but it can't fix the engine. So when the Fed cut the federal funds rate by a tiny amount, that's why our reaction was basically ¯\_(ツ)_/¯. It's not going to fundamentally fix intractable problems like low investment and productivity growth.

The fall of the neutral rate is a big deal, especially because with rates so low, the Fed currently might not have enough room to cut for when the next recession hits."

If Our Economy Is So Great, Why Did The Fed Vote To Juice It? Last week, the Fed voted to cut interest rates despite a decade of economic growth and low unemployment. Interest rates are already super low. What's going on?

Here’s something you didn’t know you needed - How did the idea of government bonds get started?

Also included: a Venetian plague, a murdered doge, and an invention that helped kick off the Industrial Revolution.

A Bond Is Born How the invention of the government bond saved a bunch of mid-level politicians from certain death and became one of the most important pieces of financial technology the world has ever seen.