The economy isn't what it used to be, and in a more globalized system it's difficult to say how much stimulation Fed rate cuts really have on the economy these days. The problem is multifaceted, people need to save more but aren't really motivated if interest rates are low but if the economy is bad people probably can't save much because they have to spend what money they have on the essentials. Oh the dilemma.

Doens't matter to me...Canadian baby

its a double edge sword. Its not going to help our economy. What would help our economy is to put jobs back in the US that we have relied on people over seas for. I know this country doesn't want to be blue collar, but we need to put production and factory jobs back in our country. Yeah kids toys will cost more, waahh, but kids have too many toys anyway. We need to get over the wal-mart affect of being cheap and pay more for USA made goods.

While I think it's a good idea for the Fed to keep their mouth shut... I think the rest of us down here in REALITY need to stop dancing around the word "recession" and just admit that we're in one already. So we can deal with the problem head-on and do something to stop this downward spiral.

Manufacturing jobs going over seas isn't necessarily bad. It's not about being blue collar or not. The questions is what do we replace those jobs with? We have to stay competitive and invest in education. We're complaining about manufacturing jobs now, wait till the higher paying jobs go too. The American worker must work harder and stay competitive. I think we should be up to the challenge and not have such a negative view about this. We keep saying how great America is, let's show people! We're a resilient and creative country. Stop blaming others, especially immigrants who work very hard!!!

We can't close ourselves off and buy only US made products.

What the Fed is doing is disgusting. They keep eroding the value of the dollar and hurting all of us who were proactive enough to save our money instead of spending these past few years. I need to move to Canada.

It's not really the Fed that's hurting the dollar. There are several things hurting the dollar, of which include(but not limited to): our ridiculous trade deficit, the growing national debt (thank you war on Iraq), and investor confidence. People aren't going to want dollars if they know that the US is just going to print more to pay its bills at some point the "exorbitant privilege" runs out.

Well, actually, the Fed IS hurting the dollar because they shouldn't keep on inflating the money supply, and the politicians shouldn't allow it either. Yes, we are overspending, but it needs to stop. By pumping more liquidity into the economy, they're bailing out the lenders who made bad loans during the housing boom, and the investors who purchased them. If they stop cutting rates and inflating the money supply, then a correction could take place. And we should let the correction happen now instead of making it worse down the road, like the poster freegracefrom states above. Instead, they are just encouraging irresponsible behavior to continue. And in the meantime, those who WERE responsible are having the value of their savings eroded. We should abolish the Fed and go back to the gold standard, but that will likely never happen.

It's a much more complex issue and placing all blame on the fed/monetary policy isn't accurate. Fiscal irresponsibility has a large role in the slide of the dollar as well. Abolishing the fed isn't a likely option or a responsible one until we find a suitable alternative and I have no idea what that would be. While I definitely agree that expansionary monetary policy isn't necessarily a positive (17 year high inflation rate etc.) retracting the money supply at this point pretty much secures a recession, not that (IMO) that's really avoidable. The FED has a finite amount of tools to use to stimulate the economy.

For better or for worst Global trade is as robust as it is today partially because we went of the gold standard allowing grater room for growth. There was/is only a finite amount of gold. (Perhaps that was a good thing ?)

I understand it's a totally complex issue, but completely disagree with you. Fiat money is behind irresponsible fiscal behavior. Not to mention that one of the primary reasons we abandoned the gold standard was to print enough money to fuel the war machine. It's undemocratic in nature. I'm definitely pro-free markets and don't believe that the Fed should intervene at all. I'm not a monetarist, as you seem to be. And you and I clearly have different perspectives on what real "growth" is. As an example, how about examining the role of the Fed in environmental degradation? The fact that they made money so cheap for so long led to increased and completely unsustainable spending and production. Furthermore, expansion and contraction of the economy is part of a normal cycle and the Fed should let it happen organically. Their intervention, along with increased supplies of fiat money, is only amplifying the peaks and troughs of the cycle and encouraging irresponsible fiscal behavior. I'm also not necessarily in favor of "robust global trade", not as it stands today anyway. The benefits of the global trade that exists today are concentrated in the hands of very few. It is environmentally destructive, and has diminished localized democratic participation in determining the most efficient and sustainable use of our resources. I don't believe the monetarist hype, particularly not when looking at the overall picture.