August 5, 2024
Elon Musk has once again criticized the Federal Reserve for not lowering interest rates sooner, calling it "too foolish."On Wednesday, July 31, the Federal Reserve decided to keep interest rates unchanged as expected.
However, Fed Chairman Jerome Powell hinted at a possible rate cut in September. Despite this, new economic data has raised concerns about a slowdown in the U.S. economy, with some market experts warning that the Fed is moving too slowly on cutting rates.On Sunday, August 4, Tesla CEO and billionaire Elon Musk issued a fresh warning. He criticized the Fed's delay in cutting rates while commenting on Warren Buffett's decision to reduce his stock holdings.
Musk called the Fed's lack of early rate cuts "foolish."Musk made these remarks on the social media platform X, responding to a post about Buffett's Berkshire Hathaway reducing its stock positions, including its largest holding in Apple, and increasing its cash and short-term Treasury reserves."He (Buffett) clearly expects some kind of pullback, or just thinks there are no better investments than U.S. Treasury bills," Musk said.
It’s clear Musk used the post about Buffett selling stocks to express his dissatisfaction with the Fed.Musk has repeatedly called for the Fed to cut rates, arguing that high interest rates increase car purchase costs, which hurts the demand for Tesla's electric vehicles. Last week, the Fed announced it would keep the federal funds rate target range at 5.25% to 5.5%. This is the eighth consecutive time since last September that the Fed has kept rates unchanged.
Policymakers stated that U.S. inflation is still above the 2% target.Powell said in a press conference after the rate meeting that if inflation continues to cool, a rate cut "could be discussed as early as September."