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He doesn't think the interest rate matters because the sums being saved are so small.
It is true that few U.S. corporations pay that maximum rate, but the statutory rate matters.
-- My colleague Jim Tankersley had a great discussion with the Wall Street Journal's Ben Casselman a few months ago on why the labor force participation rate matters.
The magic of compounding means that the exact rate matters a great deal when looking at things far in the future.
I want to suggest something to consider for those looking at large public institutions: The four-year graduation rate matters, a lot.
For more details, see this memo (PS, 17 pp) on characterizing the ACIS background, specifically Figures 1 and 2. If you are looking at the faint extended structure of a source, the high background rate matters.
Similar(46)
When the rouble was strong, the exchange rate mattered much more than domestic interest rates, and the central bank targeted the exchange rate rather than inflation.
By itself, that rate mattered much less to economic activity than, say, those on 12-month corporate loans or 30-year mortgages.
Why, you may ask yourself, should a fund's hurdle rate matter?
The official line has, in short, always been that the federal funds rate mattered because it was the interbank lending rate and, as such, was a crucial determinant of other interest rates.
To be sure, the incumbent president's approval rating matters less when he is not running for re-election.
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