To Hike or Not to Hike? This Is the Question! (But Does It Really Matter?) -

It's pretty much a foregone conclusion that the Federal Reserve will nudge interest rates higher at the September meeting. 
But should it?
What are the potential impacts?
And would such a move really be negative for gold and silver?
This week, Money Metals Midweek Memo host Mike Maharrey takes on these questions. He explains the pros and cons of a rate hike, why the mainstream has accepted higher rates as the path forward, and why it's not nearly as bearish for precious metals as you're being led to believe. 
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Mike opens the show by telling the audience about his weekend adventure. 
<blockquote>
"My son and I went to the Tampa Bay Buccaneers – Cincinnati Bengals football game last weekend. He lives in northern Kentucky, and he’s a Bengals fan. I’ve been a Bucs fan since they came into the league. Despite the "house divided," we had a blast. 
"It had been years since I’d attended a pro football game live. It’s kind of weird without the commentators constantly blathering on. It’s nice, but I didn’t realize how much I rely on the commentary to keep up with what’s going on. 
"Another difference between TV and the live experience is that the TV camera always follows the ball. It’s harder to do that when you have the perspective of the entire field. I found myself losing the ball from time to time because my eyes were following where I thought the ball would go – not where it actually went.
"In case you were wondering, you miss a lot if you’re following the wrong thing!
"And that’s exactly what’s going on with everybody obsessing over whether the Federal Reserve will raise interest rates today. It’s the wrong thing."
</blockquote>
And what exactly does Mike think is more important than Fed rate policy right now?
<blockquote>
"I think the next trillion dollars in debt piled up by the federal government will have far more impact on the economy and the markets than a little quarter-point rate hike."
</blockquote>
Mike explains that the market overwhelmingly expects the Fed to push interest rates up by 25 basis points at the September meeting, which wraps up today. While he was initially 50-50 on the Fed's next move, he said he now leans toward a hike simply because it's what the market expects.
<blockquote>
"If it were Powell, I would guarantee a hike because he was one to always do the expected. I’m not sure Warsh is wired that way, but it would be pretty surprising to go against the market consensus."
</blockquote>
But Mike said he doesn't think it matters.
<blockquote>
"Even if they do nudge rates up, I’m almost certain it will be a one-and-done tightening cycle."
</blockquote>
Meanwhile, people are selling gold and silver because they expect a higher-rate environment. Mike doesn't think that's wise. 
<blockquote>
"Even if the central bank does give rates a nudge, it isn’t a reason to sell gold and silver. It’s not bearish. You’re going to want gold no matter what the central bankers do. Because here’s the thing – they’re either going to crash the debt-riddled bubble economy or they’re going to let inflation run free. By the way, inflation will run free either way because when the economy crashes, the Fed will almost certainly do what it always does and pivot to zero percent rates and money printing to prop up the economy."
</blockquote>
Mike acknowledges he's betting against the mainstream. A recent CNBC Fed survey found a majority of respondents believe the central bank will hike rates twice in the next 12 months, with a third eyeing three rate increases. 
Mike says, "No way!"
<blockquote>
"I’m not a gambler, but I would almost bet money that rates will be lower in 12 months, not higher. I could be wrong. Other factors could intervene. But the trajectory of the economy is not conducive to high interest rates."
</blockquote>
Mike reiterates the Fed remains mired in <a href="https://www.moneymetals.com/news/2026/03/19/gold-the-federal-reserve-and-a-catch-22-004773">a Catch-22</a>. 
<blockquote>
"The Fed simultaneously needs to hike rates to keep price inflation under control and cut rates to support the debt-riddled bubble economy."
</blockquote>
The Fed chair also faces significant pressure. 
<blockquote>
"If Warsh hikes at this meeting, it could tip the economy into a full-blown crisis. But if he doesn’t, he risks appearing feckless and weak."
</blockquote>
Mike thinks the Fed head has talked himself into a corner by insisting he will be tough on inflation. He sounds like a man ready to hike rates to the moon. But, notably, there hasn't actually been a hike.
Nevertheless, everyone assumes he will put his (our) money where his mouth is this time. Mike says he can understand the reasoning. 
<blockquote>
"Price inflation remains mired well above the mythical 2 percent target. Oil prices spiked again over the last few weeks, reigniting inflation fears. (An oil price shock isn’t really “<a href="https://youtu.be/lmvFyBBJORM?si=7JcSiyJ4DxPNYtjg">inflation</a>,” but most people think it is, so we’ll accept this as a rationale.) The August jobs report was solid, giving the central bank some wiggle room to argue the economy is good and can handle a hike."
</blockquote>
But Mike says he can also make a strong case for holding rates steady or even cutting.
<blockquote>
"Forty-trillion reasons, in fact. 
"It’s pretty tough to contemplate a higher rate environment when the U.S. government is $40 trillion in debt and needs the central bank to support its borrowing and spending.
"And the borrowing and spending isn’t going to end anytime soon."
</blockquote>
Mike highlights the spending situation using recently released August deficit data.
So, how does this tie into our discussion of the Fed?
<blockquote>
"Economies dominated by a <a href="https://www.moneymetals.com/news/2025/11/15/debt-black-hole-putting-increasing-stress-on-american-consumers-004483">Debt Black Hole</a> don’t do well with higher rates. And everybody knows this. Of course, nobody will say it out loud. But I guarantee you they’re talking about it privately inside the hallowed halls of the Eccles Building."
</blockquote>
Mike says he thinks the arguments for holding rates steady actually outweigh those for a hike. 
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<blockquote>
"The economy is far from 'overheated.' CPI seems to be moving in the right direction — the slightly hotter August data notwithstanding. Raising interest rates can’t fix an oil price shock. But I kind of agree with the consensus. I lean toward a rate hike, simply because Warsh doesn’t want to lose face."
</blockquote>
Mike then drops the bombshell. He doesn't think the Fed's next move matters all that much one way or another. 
<blockquote>
"Either way, we ultimately end up in the same place — a crashing economy, surging inflation, and interest rates at zero. If the Fed hikes, I think it will tip the economy. It’s already on the edge. The debt bubble is bulging. Economic growth is stagnant when you factor out government spending. An economy addicted to easy money can’t function for very long without the easy money drug."
"And do you know what central banks do when the economy gets shaky? They cut interest rates.
"In my view, the most likely scenario is a hike with a pretty quick pivot back to rate cuts. 
"But even if they don't hike, rates are still too high given the level of debt and the economy's need for the easy money drug. We're still on the path to an economic reckoning, and the money printing will continue.
"In other words, all roads lead to more inflation."
</blockquote>
Mike reiterates that the Fed will hike. Or it won't.
<blockquote>
"But no matter what it does, it can’t change the overall trajectory of the economy. It can’t erase $40 trillion in debt. It can’t make the world fall in love with the dollar again. It won’t change its planned policy of 2 percent annual currency debasement. Don’t get too caught up in this single Fed meeting. Keep your eye on the big picture."
</blockquote>
Mike wraps up the show by highlighting a story out of Namibia in southwestern Africa. 
The country is in the process of building gold reserves for the first time, and the central bank is pursuing its initial goal of 3 percent gold reserves through a domestic buying program. 
<blockquote>
"While we’re not talking about large amounts of gold, the move is another sign pointing toward gold’s growing importance in global finance."
</blockquote>
Mike emphasizes that the reasons central banks are stacking gold are the same reasons you should consider stacking gold (and silver). When the government constantly debases your currency, you need to save in real money.
Mike closes the show by urging listeners to call 800-800-1865 and talk with a Money Metals precious metals specialist today. 
<h2>Articles Mentioned During the Show</h2>
<a href="https://www.moneymetals.com/news/2026/09/14/beyond-the-cpi-the-complete-inflation-story-august-2026-005198">Beyond the CPI: The Complete Inflation Story — August 2026</a>
<a href="https://www.moneymetals.com/news/2026/09/12/daniel-lacalle-rate-hikes-wont-fix-inflation-or-solve-the-debt-problem-005197">Daniel Lacalle: Rate Hikes Won't Fix Inflation or Solve the Debt Problem</a>
<a href="https://www.moneymetals.com/news/2026/09/15/while-everybody-obsesses-about-rate-hikes-federal-spending-marches-along-unabatted-005205">While Everybody Obsesses About Rate Hikes, Federal Spending Marches Along Unabated</a>

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