Dave Ramsey, personal finance personality, author, businessman, radio show host, and businessman, recently weighed in on skyrocketing gas prices and continuing inflation across the country and warned that actions by the Federal Reserve and the Biden administration are only compounding the crises.
Ramsey emphasized that the administration’s policies related to the labor market, energy industry, and government increased government spending since taking office are the significant factors driving inflation.
According to Ramsey, as the national average price for gasoline reached or topped $5 per gallon, Americans are fearful that the Federal Reserve’s announcement that it would raise interest rates won’t help the problem.
“The Fed raising the interest rate is not going to lower gas prices, so it’s not going to stem inflation,” said Ramsey.
He pointed out that the president’s move to dramatically decrease domestic oil production was the reason for surging fuel prices. Still, He pointed out that American voters are starting to rise up politically.
“They’re not going to tolerate this,” said Ramsey in a Fox News channel appearance. “Some of these left-wing ideas of socialism just, when you plug them into the economy, they just don’t work on a practical level.”
Ramsey noted that the November 2022 midterms could be positive for the economy. “A good bloodbath politically in the fall will indicate in the White House that they’ve got to change, or they’re going to get slaughtered again in another two years.”
In the interview, Ramsey encouraged young increasingly-concerned Americans to look back at the country’s economic history over the years. “These things have come and gone before, and they will come and go again.”
The financial expert warned that the United States will likely experience a recession but suggested that a larger perspective can help quell fears. “We’ve got a lot of negative things going on out there right now. But, if you pan back and you say, ‘OK, over the last 20 years, what’s it really looks like?’ We’ve come through stuff similar to this or as ugly and as depressing as this before.”
Federal Reserve raises interest rate to fight inflation
Recently, the Federal Reserve raised its benchmark interest rate by 75 basis points to dampen down soaring inflation, a move not seen in nearly three decades. The move threatens to exacerbate financial pressure on Americans and dampen down slow U.S. economic growth.
The hike, the first since 1994, after a string of alarming economic reports, underscores how serious Fed officials are tackling the inflation crisis. The dramatic move puts the key benchmark federal funds rate at the highest since the start of the pandemic over two years ago, between 1.50% to 1.7%.
Additionally, officials laid out an aggressive path of rate increases for the remainder of the year. According to newly-released economic projections, policymakers predict interest rates will hit 3.4% by the end of 2022, reaching the highest level since 2008.