Hi ladies and gentlemen boys and guls.
Hope every one's enjoying and in a relaxed mood after hectic exam schedule.I am not getting around with the U.S the A's moves in fighting inflation.The chairman of Fed has lowered the interest rates in presence of excalation inflation as this should not be the case in theory coz at the time of inflation govt tries to suck excessive funds floating in the market by increasing the interest rate by which ppl try to deposit their funds in bank to earn higher interest which results in reducing the excess funds in the market.At the moment different measures are being implemented interest rates being cut in the presence of inflation,Mr Ben is trying to ease capital market but he has no consideration to lower inflation.I dont understand his logic,and ideal man in his chair would try to give suffient consideration for all economic issues.

Comments are wellcomed.

Regards
Abrar

No one to comment.........................................................................................................................................
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I could have commented but I hate this subject so didnt want to hehehe....

The people in such position have to consider sooooooo many things. They take into account soo many areas and cant improve everything, therefore , they have to decide..Thats what decision making is all about.

Opportunity cost

Commenting does not cost or does not lead to any finanacial benefit on this website hehehhehheehhe

Theories are theories they are usually not as practicable as they comprehended from Text Books. There are so many economic and demographic factors which need to be looked in a specific perspective of a particular country.

In the above example of USA suppose that investors due to whatever reason are not willing to invest in banks(demographic factor) then the approach of increasing the interest rates at the time of inflation will not work as it could have worked had the demographic factor never exist.

Regards,

Muhammad Amir