Majority of Investors Disagree With Fed Lowering Interest Rates Again

This week’s Sentiment Survey special question asked AAII members what they thought about the Federal Reserve’s decision to lower rates for a second time this year. Nearly 59% of respondents say that they disagree with the decision to lower rates again. The reasons for their disagreement varied, with some saying that the Fed gave into political pressure and others saying that the decision to lower rates again was premature. On the other hand, 29% of respondents say that they agree with the Fed’s decision because it will help keep the economy moving. Additionally, 12% say that the Fed should have lowered rates more than they did.

Here is a sampling of the responses:

•  “I think it is a mistake. The Fed is misinterpreting the market signs and is being influenced by political considerations. The Fed should simply maintain the rates.”
•  “Premature in my view, if U.S./China trade disputes get reasonably resolved, world economies should strengthen.”
•  “The Fed should have kept the rates the same. Why lower them when the economy is doing well? The lowered income tax rates were supposed to have been enough to stimulate the economy.”
•  “Our family intends to take advantage of the low interest rates to purchase a new home. Otherwise, I have reservations about the impact to our national economy.”
•  “It is necessary based on all economic indicators, trade uncertainty, U.K./EU exit uncertainty, etc. And, of course, pressure from the president.”

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