Yesterday the Fed raised short term interest rates by three quarters of one percent, and the stock market rose. The stock market did not rise because of the rate hike. The stock market rose because the Atlanta Federal Reserve bank dropped its forecast for second quarter (ends June 30) GDP growth to zero — 0.0 — which means that technically we are in a recession.

As interest rate hikes worsen recessions, the stock market has concluded that Fed tightening is over. Soon the Fed will be lowering interest rates to fight recession and unemployment. The real question is: why did the Federal Reserve raise interest rates on the same day it knew the economy had descended into recession?

The Federal Reserve chairman, Jerome Powell disclaimed any intention of causing or worsening a recession by ratcheting up interest rates. But the real unanswered question is why did the Fed raise interest rates after the Fed knew we were in a recession unless the Fed wants a serious recession?