Fed Unveils New Division Solely Dedicated to Explaining Rate Hikes by Hiking Rates
Officials say the clearest way to answer 'how do interest rates work?' is with a slightly higher one.
The Federal Reserve announced the formation of a Rate Explanation Division this week, tasked with helping ordinary Americans understand how interest rates function. The division's first policy, released in a two-page pamphlet, states that every incoming question about interest rates will be answered with a modest increase to interest rates.
"We found that raising rates is, itself, the clearest possible explanation of what raising rates does," said a spokesperson for the division, adjusting a small placard that read ASK AGAIN LATER. "If people still don't understand after that, we simply raise them again until the concept sinks in."
Early testing has not gone smoothly. A pilot town hall meant to walk attendees through the basics of monetary policy triggered four consecutive hikes before anyone could finish asking their question, and one attendee who raised his hand to ask for clarification was informed that his hand itself constituted a request for further explanation.
The division insists the system is self-correcting. Once rates are high enough that nobody can afford to ask any more questions, officials say, the explanation will finally be considered complete.