The Federal Reserve raised interest rates again today. Who is this hurting?

[Paper Roses]

It is hurting me and others who live on limited incomes. WE are the ones who are paying the greatest burden with this last action. The wealthy might shake their heads and pay a more from their funds but for those of us who are living on the edge, this is a cruel move. The raise hits us the hardest. A millionaire will pay the same amount at the grocery store, the same for gas, the same for their heating oil and other commodities with a shake of the head.

For those of us, Seniors. those with limited incomes, this is cruel.

Take the money from the big guys like Exxon at al. I admit I don't understand the economics but it sure seems to me that a great number of Americans are getting screwed again.

[jimfields33]

1. Hopefully it won't hurt too much.

A huge pay increase is coming in a little over 7 weeks. Hopefully that will help your financial health.

[Paper Roses]

3. Thanks for your good thought but I'm 80 and live on SS only.

Like others, my house taxes have gone way up, as is everything else. A pay raise to workers is deserved I'm sure but that does not help those who because of age or other situations, that is no help.

The raise in Social Security in January will not cover the interest we pay for one loan or another situation. My oil delivery company told me they have no idea where prices will go. Out of my meager checks last year from S.S., I paid $2700 just to heat the house, never mind all the other expenses.Just got my new bill, house insurance went thru the roof. Electric and gas companies have warned us to expect a 50 to 70 % raise in monthly cost.

Like so many others, I've paid into S.S.. since I was 16. The government lived on our contributions. Now some of the vulgar Repubs want to that that away. I'm sick to death about the whole mess.

I can't afford to move because the rate for a decent 1 BR apartment in my area is about $3500.00 a month. May or not include heat or any other amenities. Not that it is cheaper to stay where I am but the alternative will put me in the poor house or on the street.

When my husband died, I had transferred to me, 2 stocks. Verizon and AT&T. They have gone down the sewer. Not worth selling because there is no real benefit in selling them now. So much for a little cushion. There is nothing else.
Yes, I'm depressed! And YES. I voted BLUE!

[liberal_mama]

20. Yes, I haven't had the motivation to fill out my ballot yet, but I will be voting blue. My property

taxes are sky high, food prices are totally unaffordable, utilities have practically doubled and now credit cards/mortgage will go up again too. My house needs a new roof badly, but there is no way to afford one. Hopefully, the winter in New York won't be too bad this year.

My beloved father died of Covid 2 weeks ago because both political parties are minimizing the pandemic and have convinced people that they don't have to wear masks or take precautions. My dad was very liberal, a Union steward, but sadly his ballot will not be mailed in. He will never be able to vote again and I will never have a dad again. He was my favorite person, always there for me. He was in his early 70s and healthy, but Covid just completely ravaged him. He went into the hospital because he hurt his back doing cement work and he got infected with Covid while there. He never came back home and died in horrible pain, on a ventilator in an ICU room.

I'm disabled and immune compromised and now even more terrified about Covid after seeing the horrible suffering death of my father.

I have special dietary needs because of my diabetes and I can't even afford to eat much more than rice, pasta, ramen noodles, and tuna on white bread these days.

My much loved cat died suddenly 10 days before my dad. This cat gave me so much comfort, but I can't get a new cat because I really can't afford another one anyway.

My only daughter moved to Pittsburgh last Sunday because she and her husband don't want to pay the high New York taxes anymore.

Things are really bleak for a lot of us. I really hope things will get better, but I don't feel too optimistic.

I'm sorry to hear about all of your troubles too.

[Fiendish Thingy]

2. How is the interest hike affecting you specifically?

Are you using a variable rate HELOC to pay your bills? That’s really the only way these hikes would affect you, unless you’re buying a house or a car.

If your 401k has taken a hit this year, you aren’t alone. The good news is the market has gained 14% in the past month.

Without these drastic hikes, inflation would likely be in the double digits. Interest hikes are the Fed’s only tool against inflation. If we had the votes in congress, we could pass a windfall profits tax on the corporations that are gouging consumers.

The good news is, SS gets an 8.7% COLA raise in January, the highest ever.

[Paper Roses]

8. Worked all my life, never had a 401K option. No use to me now.

Years ago, we were self employed and there was no option for a 401K at the time. When we closed our business, both my late husband and I worked. His job dissolved and shortly after, the company I worked for moved to Alabama. This happened when I was 65 and my husband was 72. No real jobs available then for people of our age. Shortly after these events my husband died of a stroke. I've been living on our savings after all the medical and funeral expenses. It has been 14 years and I'm running out of funds.

It has been hell and I'm not sure how to cope with things at 80 years of age. Not buying anything except groceries, I hope my old car hangs on without repairs. If I need anything, I'll hit the thrift shops.

Hard not to be disgusted and worried.

[Fiendish Thingy]

28. Sorry to hear of your situation, but interest hikes aren't causing inflation

Interest hikes will eventually bring inflation down, perhaps causing a recession in the process.

Katie Porter has shown that over half of the inflation in consumer prices is due to price gouging by the corporations.

If we had the votes in congress, we could pass a windfall profits tax to take some of the incentive out of price gouging.

[former9thward]

11. The raise is not the highest ever.

It went up 11.2% in 1981.

[Fiendish Thingy]

29. Ok, highest in 40 years. Nt

[PufPuf23]

18. The higher Fed rates affect those on low, fixed incomes by the general rise

in prices increased by higher payment for loans despite the dampening of inflation.

The SS COLA is less than the actual increase in cost of living so the overall impact of a raise in Fed rate is a transfer of wealth from the poor to the wealthy. A windfall profit tax could help as corporations ae gouging consumers.

[Fiendish Thingy]

30. Which is what I said

It affects those who take on debt by purchasing a home or car, or using a variable rate loan to pay bills, but that’s not unique to people on fixed incomes.

Perhaps it affects those living on income from reverse mortgages?

But if you aren’t taking on new debt, whether on fixed income or not, interest hikes are not affecting your cost of living.

Interest hikes do not cause inflation.

[Samrob]

4. Making the rich richer and poor poorer and never having a chance to not be poor. nt

[Mistwell]

5. Why is this hitting lower fixed incomes?

I am not understanding how interest rate increases would, as a general matter without knowing more, impact those on lower fixed incomes? It's the inflation that should be hitting lower fixed incomes the most, and a rate high will generally reduce that inflation.

[maxsolomon]

6. No, you don't understand the economics.

It is supposed to slow inflation and price increases by slowing demand.

[Paper Roses]

9. Slowing the demand? If you are on fixed income, the demand is minimal.

The demands are the bills and the cost of maintaining a life.

[maxsolomon]

27. Right, your demand is minimal.

Your complaint seems to be inflation and rising prices, which is basically everyone's complaint. Even rich people, who are the kings of whining, as they typically overextend themselves.

The Fed is trying to slow the demand-based, supply-chain-impacted price increases.

Are you taking out a mortgage or buying a vehicle? That's when it will hurt; but it should be noted that Interest Rates are only getting back to where they were in 2008.

[W_HAMILTON]

15. "The solution to the problem of higher prices is higher prices."

And I fail to see how one country increasing interest rates is going to slow down the global inflation that is occurring across the globe and in virtually all similar economies.

People also sometimes turn towards credit cards to get by and these interest rate increases are certainly not helping out anyone that carries any sort of credit card debt.

[maxsolomon]

26. I'm not saying I think it will work globally.

There is some evidence it's having an impact in the US, though. Per NPR this AM, new vehicle prices are stabilizing and/or declining, and inventory is increasing. Because money isn't so cheap now, and demand is lessening.

Also, the general doom and gloom in the Development/Real Estate world that higher rates have created.

[Fiendish Thingy]

31. Central banks in most developed countries are hiking rates

Inflation in the US is among the lowest among the G20.

Higher Rates don’t cause higher prices, they cause the cost of debt to go up.

Higher rates actually put downward pressure on prices , especially real estate, since buyers can’t qualify for loans at higher rates for homes at current prices. Sellers must lower prices in most markets so buyers can qualify for higher rate loans.

[RussBLib]

10. snark not appreciated

especially when a lot of people are hurting from this.

try to have some empathy

[TheProle]

12. I'm having trouble in seeing the duplicity

Last edited Thu Nov 3, 2022, 10:54 AM - Edit history (1)

in a scared 80 year-old widow struggling to eat.

[W_HAMILTON]

16. Uhh, because the Feds increased the interest rate again today...

...and there were some not-so-positive comments made about their future intentions.

The fact that you weren't aware of this and yet still added your snark is proof that, yes, unironically, you should "study up more on the subject..." when it comes to matters such as these.

[liberal_mama]

13. It's hurting me too. Why would they do this less than a week before midterms?

I'm so disgusted. I'm a diabetic and can barely afford to eat any healthy food already and now rates on mortgage/credit cards will go up. This is just so cruel.

[W_HAMILTON]

17. It's a fucking Republican doing this.

I guess he wants to be the James Comey of the 2022 elections.

I wish we, as Democrats, would learn to clean house of any and all Republicans when we gain control.

Never trust a Republican.

[liberal_mama]

22. Well, no doubt. I have never voted for a republican and never will

I'm just hoping we don't end up with a republican governor in New York or lose the Senate/House. This is terrible timing for a rate hike when so many people are already struggling.

[Mr.Bill]

14. It mainly hurts people buying or selling

big-ticket items like real estate or vehicles.

Not saying it doesn't hurt others also. Probably hurts everyone to some extent.

[doc03]

19. It's going hurt everyone that is looking to buy

a house, auto, appliance or anything on credit. Retired people depending on income from their IRA, as of now my IRA is down 15% or more. It is going to put people out of work. New construction will stop. People won't get a wage increase. It will hurt everyone but the 1%.

[roamer65]

23. It's not going to stop inflation.

Inflation right now is due to dysfunctional supply chains in tandem with a massive increase in the M1 money supply.

The war in Europe is fueling the problem as well as climate change.

[andym]

24. High interest rates hurt business, as well as the consumer

Big tech will be hurt as will startup companies trying to raise money and other businesses looking to expand. Various bubbles including real estate will be popped, costing both rich and poor their investments to the extent they have such.

The benefit is that it is known that this approach will eventually tame inflation based on 1979-1983 experience with Paul Volcker at the helm of the Fed-- that time the Fed induced a big recession.

[Dysfunctional]

25. There is one out for people who are on Social Security and/or disability,

look at your federal and state laws on credit card debt or if you have credit cards that you can borrow money on or max out.