When rates fall again - Deepstash

When rates fall again

When rates fall again

The yields are still very low. They don’t keep up with inflation, and if they eventually do, that’s probably not good news either.  Even if the Federal Reserve manages to reduce the rate of inflation close to its 2 percent target rate, it will slow the economy, perhaps tipping it into a recession.

If the slowdown is evident, the Fed is likely to start cutting rates, creating an opportunity for nimble money market fund managers to beat inflation by a small amount.  While money market fund yields are improving, as an investment they remain a bad idea.

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