We all know why Harry Truman used to famously pine away for that “one-armed economist.” He didn’t appreciate their inherently equivocal, “but on the other hand” approach. We were reminded when the Federal Reserve recently bumped up its federal funds rate by 0.25 percent, the first such hike in nine years. Most experts saw the move as a vote of confidence that the economy is now strong enough to handle higher borrowing costs while maintaining growth. Who doesn’t like bullish news?
But it does mean slightly higher consumer costs on credit cards, car loans and mortgage payments. However, on the, yes, other hand, it’s better for savers. Moreover, could there be a pattern at play? Bet-hedging anyone?
The front-page headlines in last Thursday’s two local dailies reflected the usual other-handed reaction. The Tampa Tribune: “Interest Rate Hike To Have Little Effect On Your Wallet.” The Tampa Bay Times: “Fed’s Rate Hike May Sting.” Or not.