Dividends and Fed fretted over bank turmoil’s consequences:minutes

If you are interested in how the Federal Reserve is doing and because they raise and lower interest rates to the banks, most people are interested, you maybe surprised they have the same concerns as average people. The Fed has access to greater information than the average person, but the Fed has the concerns of the average person.

In an article by Jeanna Smialek of the New York Times News Service, Federal Reserve officials wanted to remain flexible about the path for interest rates as they weighed a strong labor market and high inflation against the risks of the recent bank turmoil posed to the economy, Fed Reserve minutes showed.

Before the banks of Silcon Valley Bank and Signature Bank failing, most people of the Fed were interested in fighting inflation and were considering raising rates higher. After the meeting, participants wanted to retain flexibility in the system and were suggesting raising rates was almost done. The Fed will be watching data on credit and financial institutions willingness and ability to lend money.

Linking to dividend paying stocks, the interest rate is highly linked to investing in dividend paying stocks, if you can achieve a greater yield on the dividend plus the capital gain than interest rates money flows into dividend paying stocks. If the interest rate is higher, bonds guaranteed by the government is a good thing to own, then dividend owners discuss total returns and tax advantages for dividends over interest. Paying attention to the Fed is a good thing, but do not be surprised they likely have similar views as yourself.

There are more questions than answers, till the next time – to raising questions.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s