To combat the 1990-1991 recession, the Fed Funds rate was cut to 3 %.
To combat the 2001 recession, the rate was dropped to 1 %.
Now, a Federal Reserve study has put the 'ideal' interest rate, based on current economic conditions, at - 5 %.
Will the 'ideal' rate during the next recession be - 10 % ?
The U.S. consumer seems to have reached their endpoint in terms of personal deficit spending. Either there will be a source of new demand, or the world will be bloated with excess industrial capacity. Call it under-consumption, a crisis of over-production, or weak aggregate demand relative to capacity - but the world economy looks to be structurally fractured.