http://www.washingtonpost.com/business/economy/low-interest-rate-environment-expose-seniors-to-fraudsters/2013/04/18/63d065dc-9c77-11e2-a941-a19bce7af755_story.html
There are always people in the world that will scam you into taking your
money. There are more privacy and protection methods to protect your money and
investments nowadays but there is an upward rise in scams on senior
citizens. Government regulators and advocacy groups say unscrupulous
dealers are taking advantage of a growing fear among seniors that they will run
out of money in their final years of life. The FED dropped interest rates in
2008 in efforts to stimulate the economy however this meant a sharp drop in
income for seniors. Because of many scams seniors have become more reluctant to
hold onto their money instead of investing it. But monetary policy is all about
the trade-offs.
Artificially low IR caused the housing collapse. An effect of low interest rates might be that people will borrow and launder money instead of investing it. Hedge funds kind of do that.
ReplyDeleteI think the Fed is doing more damage to the economy than good.
The government could impose a fiscal policy of an increase in government spending and create some jobs for people to catch these fraudsters.
ReplyDelete