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As financial markets experience challenges, economist Jeremy Siegel is urging the U.S. Federal Reserve to lower interest rates more quickly than expected.&nbsp; 
Siegel, a professor emeritus of finance at the Wharton School of Business, believes the Fed should cut rates by 0.75% right away and make another similar cut next month. 
The current Fed funds rate is between 5.25% and 5.5%, but Siegel suggests it should be between 3.5% and 4%. A 75 basis point cut means reducing the rate by 0.75%. 
“I’m calling for a 75 basis point emergency cut in the Fed funds rate, with another 75 basis point cut indicated for next month at the September meeting, and that’s minimum,” Siegel said during an interview with CNBC. 
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 "I'm calling for a 75 basis point emergency cut in the Fed funds rate, with another 75 basis point cut indicated for next month at the September meeting – and that's minimum," says Wharton's Jeremy Siegel: <a href="https://t.co/s4CgWx962Q" target="_blank">pic.twitter.com/s4CgWx962Q</a>— Squawk Box (@SquawkCNBC) <a href="https://twitter.com/SquawkCNBC/status/1820420112895074315?ref_src=twsrc%5Etfw" target="_blank" rel="noopener">August 5, 2024</a>
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The push for rate cuts follows recent weak <a href="https://www.cryptotimes.io/2024/08/03/u-s-job-data-release-shows-decline-in-labor-market/" target="_blank" data-type="link" data-id="https://www.cryptotimes.io/2024/08/03/u-s-job-data-release-shows-decline-in-labor-market/" rel="noreferrer noopener">job reports</a> and global economic instability disclosed by <a href="https://www.cryptotimes.io/2024/08/01/interest-rate-cut-could-be-possible-in-september-fed-chair-jerome-powell/" target="_blank" rel="noreferrer noopener">Fed Chair Jemore Powell</a> last week. The employment figures have stoked fears of an impending U.S. recession, compounded by the Bank of Japan’s recent interest rate hike above 0%.&nbsp; 
These factors have collectively triggered a dramatic downturn in both stock and cryptocurrency markets, with Bitcoin dropping below $50,000 for the first time since February. 
This situation has been compared to March 2020, when markets crashed due to the coronavirus pandemic. Back then, central banks cut interest rates and added liquidity, helping the markets recover. Siegel believes similar actions are needed now to support the economy. 
Siegel pointed out that the Fed’s long-term target for the rate is 2.8% when inflation is at 2% and unemployment is around 4.2%. With July’s unemployment rate at 4.3% and June’s inflation at 2.97%, he argues that the Fed’s current rate is too high and not suitable for the current economic conditions. 
“If they’re going to be as slow on the way down as they were on the way up—which, by the way, was the worst policy error in 50 years—then we’re not in for a good time with this economy,” Siegel said. 
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow"> 
 Also Read: <a href="https://www.cryptotimes.io/2024/08/06/u-s-government-transfers-699k-in-ethereum-arkham/" target="_blank" rel="noreferrer noopener">U.S. Government Transfers $699K in Ethereum – Arkham</a> 
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Economist Calls for 1.5% Fed Rate Cut Amid Market Decline

The Crypto Times

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