MARY REICHARD, HOST: Coming next on The World and Everything in It, the Monday Moneybeat.
NICK EICHER, HOST: Reading Federal Reserve meeting minutes is a part art and part science.
But last week, the central bank released its most recent meeting minutes, and here’s what we read: a majority of the Fed governors is content to leave interest rates alone for the rest of 2019. That should keep the cost of borrowing from rising.
It’s not what the Trump administration wants, though: the president and his advisors have called on the Fed to go beyond forswearing interest-rate hikes. They want interest-rate cuts.
But nothing in the meeting minutes suggested an appetite for that.
In the aftermath of the financial crisis and for the entirety of the Obama presidency, the Fed kept interest rates at near zero to help the economy along.
The Trump White House argues that despite the strong U.S. economy, the global economy is slowing substantially.
The old adage is, when the United States sneezes, the world catches cold. The Trump administration is saying, essentially, the reverse is also true, and the Fed needs to give us a shot of Vitamin C, so to speak, by lowering those rates.
REICHARD: Well, today is tax day, April 15th, and we’re paying our 2018 taxes.
But it’s a good time to reflect on how revenues and expenditures are shaping up for fiscal year 2019. In other words the federal budget deficit.
The midpoint of the fiscal year is the end of March, and we received the data on that last week. At the midpoint, the federal budget deficit is 15 percent higher that it was at the same time last year.
What that means is the deficit’s on pace to exceed $1 trillion.
The tax-rate cuts that have spurred economic growth have generated more tax revenue to the treasury than the higher rates did last year, about $10 billion more year-on-year at the midpoint.
But government spending is $100 billion higher, and that’s what’s driven the deficit up.
EICHER: On Wall Street, the third weekly gain in a row for the Standard and Poor’s 500 index of stocks. It was a modest gain of half-a-percentage point. Tech-heavy Nasdaq stocks picked up six-tenths. The smaller-company Russell 2000 stock index up a very slight one-tenth of a percent.
The only loser of the big four was the Dow Jones Industrials. The Dow finished strong on Friday but not enough to overcome losses earlier in the week, so it ended the week down less than five-one-hundredths of a percent.
And that’s this week’s Monday Moneybeat.