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How is the Federal Reserve handling interest rates?

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    Gerri Willis discusses the economy's current state

  • Duration 4:15
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What was going on in the world -- -- we're talking about the Federal Reserve I love your topic by the way but I but I also like tech about the Federal Reserve today it's Ben Bernanke meeting.

All eyes on the Federal Reserve because of monetary policy right we've had rates at or near zero for three and a half years now and we just found out they're gonna keep it that way.

Two big questions I have for Ben Bernanke today and I won't get asked -- because I'm not in Washington and number one he's watching.

I think he'll be -- you know where most of Federal Reserve anyway you.

Mikey finally inflation come shopping with me we go shopping -- I love you finally inflation.

Milk bread let's pick up some gas flour out -- if you can't find inflation is inflation at the gas bumpy and secondly why is your view of the economy.

The Federal Reserve is that they expect GDP -- between 2.2 in two point 7% this year.

-- it's so different from the White House.

The White House says everything's wonderful were recovered we've done everything but the Federal Reserve says the economy is still.

In the world of hurt I'm sure you'd like counts those questions to -- well the second question obviously your right -- you know the economy is still in the world of hurt and they're still a tremendous amount of risk that's in the world economic situation.

Don't do that -- here is I don't really think that has much choice but keep interest rates very -- under the circumstances by.

There are a lot of negative consequences that are introduced by low interest rates for example ask anybody's living on fixed income and trying to invest their money and when you've got.

Ten year treasuries at 2%.

You you can't live off of that -- so there's there's -- you know for -- low interest rates are great but for savers they're horrible.

And so you really punishing a lot of people who played the game correctly their entire lives.

Got to this point and now can't live and what -- -- isn't perfect level of interest rates that in case -- is a somewhere down the.

Now everybody's a winner -- loser depending on where they are -- thank.

You there is no perfect answer but this is not a perfect answer do you remember the dotcom bust -- that came after years and years of holding interest rates down Ben Bernanke -- and Bernanke.

That's when I mean to say -- former Federal Reserve Chairman Alan Greenspan you'll watch a little right that's right he kept rates low for a very long time and we paid the price yeah.

Don't give I've done talking -- the dot -- both of you it could you do a lot of these kind of stuff.

-- we headed for another dot com -- we seem to keep getting all of these.

Big IPOs in the dotcom companies that we are back all of them you know people getting -- for billions of dollars in -- Graham and all this but we headed for another bust.

I don't know I think that's a great question I think these these companies are clearly overvalued but it.

Point we're talking about tonight and our show is.

Really these -- that are so overvalued look at apple for example what kind of good is that doing our economy.

Not a lot to be frank look at all of these phones are made overseas they're not even made in this country.

It -- I think that is who.

Really interesting line is important because this is one of the fundamental issues with our -- seen it is it's that.

That a lot of -- -- the jobs are being for an overseas but it's also the fact if you look at these companies like.

-- Graham or.

You know.

Groupon or even Google their.

But got massive market caps but essentially no employees -- old days of -- afford that little literally still -- Ford would grow.

And the market cap would go up and they would hire people and so people assumed that the economy of the corporate finance world and jobs were equivalent.

They're not anymore there's been there's been -- -- the technology world has caused a huge divorce.

And so these companies can get big and make tons of money and macroeconomic indicators can look great but you're gonna leave the jobs -- -- and then they're not pulling the -- court the way they used to -- it used to be what's good for G.

And -- good for the country but now what's good for Google who -- he was.

For apple I'm not you're in this is I'm being very dangerous people have to get their -- right it's a huge economic policy point all right Gerri Willis queen of the Fox Business Network on the -- report every hour of every day.

Obama -- business network 5 PM make -- -- that -- -- 58115.

I'm pretty much every hour in between she's always this year because home her husband misses that yeah I.

Great to have you here Bob rice great to have you here as always of course managing partner attending capital.

I.

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