Another Big Rate Hike: Does the Fed Have a Plan?

September 29, 2022
The Fed is determined to break the back of inflation by raising rates again and again—but at what cost to the economy, employment, and the markets? Is there a plan?

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After You Listen

With the latest 75-basis-point increase, the Fed is on course to push interest rates to over 4.5% in early 2023. But investors wonder if things are moving too far too fast. Liz Ann Sonders, Schwab's chief investment strategist, joins Mike to discuss whether the Fed actually has a plan. Will they curtail the hikes before pushing the economy into recession? What's next for the markets—will the decline continue as long as the Fed keeps raising rates? They also discuss how large corporations are reacting to the new minimum tax imposed by the Inflation Reduction Act. And they consider whether there are opportunities for investors in this volatile market. Does buying the dip still apply?

Mike also looks at the scramble on Capitol Hill to keep the government funded through mid-December and recent testimony before Congress by the head of the SEC, where he discussed the agency's plans to overhaul equity market structure, require public companies to disclose more about their climate risk, and strengthen the regulatory structure around cryptocurrency.

WashingtonWise is an original podcast for investors from Charles Schwab.

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