The Fed Don’t Sweat the Fed This should be short. There are a lot of good reasons not to worry about the FOMC raising Fed funds or not. If they raise Fed funds: First, savers deserve a return. Economies work better when savers get rewarded. Second, investors do better on the whole when there is a risk free asset earning something to allocate money to, because otherwise investors take too much risk in an effort to generate income. Third, the FOMC should never have let Fed funds rates go below 1% anyway — the marginal stimulus is limited once the yield curve gets slope enough for the banks to lend. They don't really need more than that.... More