What the Fed's Latest Warning to Wall Street Could Mean for Investors
Fed Chair Kevin Warsh warned markets that the Fed's 2% inflation target is firmly in place.
Overview
Don't fight the Fed.
It's a simple axiom that most seasoned investors have learned over years of investing and generally abide by.
Details
Why? When the Federal Reserve loosens monetary policy by lowering interest rates, it's a tailwind for the entire stock market because companies' interest expenses fall, leaving more money to invest in equipment and people to increase their top and bottom lines. In addition, it also tends to make it easier for consumers to finance purchases, which drives consumption higher.
Source
Originally published at www.fool.com.
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Disclaimer: This article is for informational purposes only and does not constitute investment advice. Data may be delayed up to 15 minutes. Past performance is not indicative of future results. Consult a licensed financial advisor before making investment decisions.