Congressman Reed: Raising Interest Rates Could Have 'Devastating Consequences'
*By Amanda Weston*
If the Federal Reserve continues to raise interest rates, the country may be in for "debt crisis," something "we've been warning about for years," said GOP Congressman Tom Reed.
"The problem we face is, with this growing economy, this huge economy that is just booming across the country, I don't know how the Fed can continue to raise interest rates," Rep. Tom Reed (R-NY) told Cheddar Thursday.
The Dow Jones Industrial Average was down almost 300 points [Thursday afternoon](https://cheddar.com/videos/selloff-spreads) after dropping more than 800 points Wednesday. The S&P was also down for its sixth straight day.
The continued sell-off came after President Trump sharply criticized the Fed on Wednesday night, [saying it's "going wild"](https://www.reuters.com/article/us-usa-trump-fed/trump-calls-loco-federal-reserve-too-aggressive-fox-interview-idUSKCN1ML1TA) with interest rates.
Reed praised the president for his "disruptive style, a unique style."
"I appreciate that," Reed said.
"But I think what I'd focus on, and what people should focus on, is what policy do we have to worry about with the actions of the Fed?" he asked. "And the policy that I'm very concerned about is, how do they control inflation when they cannot raise interest rates like they have historically? And that is the problem because the Fed can't raise these interest rates that much higher without igniting a debt crisis going off, and they know it."
The market's sell-off coincides with another shake-up in the countryー the confirmation of Justice Brett Kavanaugh, who officially took his seat on the Supreme Court this week. After dramatic testimony from the Justice and one of his accusers, Prof. Christine Blasey Ford ー who alleged Kavanaugh assaulted her when the two were in high school ーan FBI investigation, and a tense 50-48 vote, Kavanaugh was sworn-in, still shrouded by controversy.
Reed said Kavanaugh will carry his existing history on the bench to his new role as Supreme Court Justice.
"The last few weeks, in my humble opinion, has been very sad for the entire country on both sides ー from Dr. Ford's perspective, from Brett Kavanaugh's perspective," Reed said. "To see now, in my opinion, the weaponization of sexual assault for political purposes, it's just a place I never thought we would go as a country."
This echoes Trump's [previous comments](https://www.cnn.com/2018/10/02/politics/trump-scary-time-for-young-men-metoo/index.html) expressing concern for men who might be falsely accused of assault in the future.
Reed added "the Kavanaugh situation" may have motivated voters who had previously planned to opt out of the midterms, potentially allowing Republicans to maintain their control of the House.
For full interview [click here](https://cheddar.com/videos/rep-reed-talks-trump-haley-kavanaugh-and-hurricane-michael).
Inflation remains hot as the January PPI has increased by 1 percent, twice what analysts had been expecting with a jump of 9.7 over the year. Beth Ann Bovino, the U.S. chief economist, for S&P Global Ratings, joined Cheddar News to discuss the rapid pace of inflation alongside higher wages, predicting the Federal Reserve will act quickly and forcefully this year. "They haven't changed their forecast, yet, that's gonna come out soon. But we expect that a March rate hike is basically pretty much baked in the cake," she said. "We think six rate hikes in total for 2022."
For black history month, Cheddar is highlighting black business leaders who are driving the need for representation forward. On February 10, the U.S. Chamber of Commerce hosted an event called 'Developing the Black-Owned Business Ecosystem.' The virtual event was organized under the lobbying group's two initiatives -- the Equality of Opportunity Initiative, and the Coalition to Back Black Businesses. The event highlighted the developments needed to develop more black-owned businesses in the U.S. Dr. Anthony Wilbon, Dean of the School of Business at Howard University, joined Cheddar News' Closing Bell to discuss his experience as a speaker at the event.
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Last week, Senators Ron Wyden of Oregon and Martin Heinrich of New Mexico, Democrats on the Senate Intelligence Committee, wrote a a letter airing concerns that the CIA is collecting the data of American citizens without their consent. The lawmakers fear that the program might be exploiting private data. Morgan Wright, the chief security advisor at cybersecurity firm SentinelOne, joined Cheddar News to discuss the ramifications of the letter. "We don't have all the dots in one place to connect them," said Wright, cautioning against jumping to conclusions.
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Nancy Pelosi and House Democratic leaders are now planning to amend the stop trading on congressional knowledge act, otherwise known as the 'Stock' Act. This 2012 law governs how members disclose the purchase or sale of stocks and amending it would close a loophole, eliminating the trading of individual stocks by members of congress. Pelosi has consistently opposed a ban on stock trading by lawmakers and congressional staff...so what's changed? Kedric Payne, Vice President of Campaign Legal Center, joins Cheddar News to discuss.
In a 5-4 vote, the U.S. Supreme Court allowed for a controversial new version of the Alabama congressional map to remain in place. The lower court had previously ordered that the state must redraw that congressional map because it violates the Voting Rights Act by diluting the political power of Black voters. Redistricting expert Yurij Rudensky joins Cheddar News to weigh in.
