Forbes Media CEO Steve Forbes has warned that President Joe Biden’s policy to raise the interest rates in order to solve the inflation problem will “make people poor”.
In an interview with conservative news outlet Newsmax, Forbes stressed that raising interest rates will have severe effects on American consumers.
“Let’s be blunt about it. When they talk about a soft landing or trying to slow the economy down, that means making people poor,” he said.
Rather than “punishing the American economy” with higher interest rates, the Federal Reserve should focus its efforts on stabilizing the value of the dollar, he added.
Many economists have voiced concern about a possible recession after the Fed last week announced its highest interest rate increase in 28 years.
Forbes stressed that the interest rate hikes will particularly hurt consumers when “mortgage rates are readjusted later this year” and heating prices rise in the winter.
“A big, bad thing is happening. And when heating oil prices come in this winter, when you’re paying twice as much as you were before and you have to heat your home, that’s going to be a disaster,” he said, adding that “whatever they want to call it, it’s not good.”
The US is grappling with rising prices and soaring inflation, with its population under severe pressure like many of the European countries.
Biden’s administration placed an embargo on Russian oil earlier this year, shortly after Russian President Vladimir Putin declared a military campaign against Ukraine on February 24. It prompted the gas and energy prices to hike all over the country. The move has also sent the prices of grain, cooking oil, fertilizers and food skyrocketing.