Business Leaders Are Already Blasting the Fed for Creating a Downturn

According to a survey by the Dallas Fed, a number of regional business leaders are worried that the central bank is raising interest rates too fast.

There is still a lot of anxiety about labor scarcity, product delays, inflation, and so on in these surveys. It is noteworthy that some players on the ground are concerned that the economic downturn will be much worse than the Fed thinks.

Someone from the motor vehicle and parts industry wrote here.

[I’m] very concerned that we are in for a tough stretch as the Federal Reserve is out of touch with reality. Interest rates doubled within a short period of time. Expenses are increasing at a rapid pace. Pressure on margins will drive down profitability.

A person from the merchant wholesalers, nondurable goods sector made the statement.

The Federal Reserve has lost its way and needs to stop increasing rates and let the economy and employment settle. The Federal Reserve actively participated in causing this inflationary cycle by its aggressive and irrational buying of mortgage-backed securities that represent 30 percent of its portfolio. Continuing on this path will cause a recession and leave the Federal Reserve with little options. Raising rates as the Federal Reserve has done has cost the U.S. Treasury untold sums to finance the government. If the Federal Reserve governors had any self-respect or integrity, they would resign.

A person from the Building Material and Garden Equipment and Supplies Dealers trade is responding.

Amazing how fast our business has slowed down after all the negative talk about the homebuilding business. Numbers are down 23 percent in October from September this year and trending the same for November, so it’s hard to know just where this market is going. We’re adjusting on hiring, inventory and capital expenditures, but it is just amazing as there is still a demand for housing in the Texas market; hopefully, when the shock of the markets settles in, we will have some type of normal. I think the Federal Reserve made too much of a drastic move that does nothing to address inflation in food and energy.

Yesterday, similar comments were made in the Dallas Fed's manufacturing survey.

This is a response from computer and electronic product manufacturing.

[The Federal Reserve] is going too crazy—that is really affecting the industrial equipment industry and stalling infrastructure spending as I have never seen before. Millions of jobs are at risk in manufacturing.

Also from transportation equipment manufacturing.

The outlook is troubling and unsettling. Caution is the strategy. The Federal Reserve is too aggressive. Let what’s been done materialize in the economy before piling on.

The full services sector survey and the manufacturing survey can be found here.