by Michael Snyder
The Economic Collapse Blog
The Federal Reserve is stuck between a rock and a hard place. If the Fed pushes rates higher, interest payments on our 34 trillion dollar national debt could spin wildly out of control and bank balance sheets will be in even worse condition than they are now. First Republic just bit the dust, and literally thousands of other small and mid-size banks and in serious jeopardy. So it would be suicidal to hike rates at this point. But if the Fed were to reduce rates, that would be like injecting jet fuel into a raging fire. Our ongoing inflation crisis is absolutely crushing working families, and the rising cost of living has risen to the top of the list of things that U.S. voters are concerned about. The Fed seems very hesitant to cut rates, because that would make inflation even worse. So at this point the Fed is essentially caught in a “deer in the headlights” moment because it doesn’t know which way to go.
But staying on the path that we are currently on is only going to end in disaster.