Here’s a finger-picking bluegrass song about the Fed’s plan for interest rates

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Editor’s Note: What do a fiddle, a barn dance and a bale of hay have to do with the Federal Reserve’s interest rate policy? A whole lot, says Merle Hazard, who’s written yet another finger-picking country song about the economy.

In the past, Hazard, aka Jon Shayne, has taken on mortgage-backed securities, derivatives and central banking. This time, he has a question: How long will interest rates stay low?

He performs with Grammy Award-winning artists Alison Brown and Tammy Rogers King and Grammy-nominated musician Trey Hensley.

Economics correspondent Paul Solman takes a closer look at low interest rates with economist Mohamed El-Erian on tonight’s Making Sen$e. After watching the music video, El-Erian dubbed Merle Hazard’s tune both “brilliant” and timely. Here at Making Sen$e, we couldn’t agree more.

— Kristen Doerer, Making Sen$e Editor


Lyrics

Chorus 1
How long (how long) will interest rates stay low?
That’s the question, the whole world wants to know
How long (how long) will interest rates stay low?
It seems like if they’re going up, they’re going pretty slow

Verse 1
Our country’s central bank is really scared, that’s plain to see
When everything is leveraged, raising rates is misery
But keeping rates too low, too long, would cause us pain and sorrow
There is no easy option in a land of constant borrow

Chorus 2
How long (how long) will interest rates stay low?
That’s the question, the whole world wants to know
How long (how long) will borrowing be free?
How long will we be subsidized by savers and retirees?

Verse 2
Central banks around the world, not only in the States
Are each at work on lengthy slumps, their countries’ tragic fates
Legislatures will not spend to give sufficient boost
Lower interest rates are all that’s left to get their countries juiced

Chorus 3
How long (how long) will interest rates stay low?
If you could predict it, you could make a lot of dough
How long (how long) will interest rates stay depressed?
The answer…is anybody’s guess

Verse 3
Some say low rates are symptomatic, rather than the cure
I have a hunch they’re right. I can’t say I am sure.
But recovery has been long and slow, the crisis wounds are deep
So until we see inflation, money’s likely to be cheap

Chorus 4
Instrumental solos

Verse 4
Capital’s abundant, money’s not in short supply
China holds our Treas’ry bonds, although I wonder why
Start-ups happen in the cloud, few people are employed
If something could push rates back up, I’d be overjoyed

Chorus 5
How long (how long) will interest rates stay low?
That’s the question, the whole world wants to know
How long (how long) ‘til we really start to grow?
Interest rates are goin’ up, but they’re go-in’…pret-ty…slow….


“How Long Will Interest Rates Stay Low?” is a coproduction of Merle Hazard, Nashville Public Television and Making Sen$e. The lead vocal is Merle Hazard; Alison Brown plays the banjo; Tammy Rogers King is on the fiddle and background vocal; and Trey Hensley is on the guitar and background vocal.

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