Fed Researchers: Interest Rates have "mixed evidence, at best" on investment

More MMT support coming from the Fed's own research, this time from the Board of Governors. The abstract reveals the most significant findings:

"A fundamental tenet of investment theory and the traditional theory of monetary policy 
transmission is that investment expenditures by businesses are negatively affected by 
interest rates. Yet, a large body of empirical research offer mixed evidence, at best, for a 
substantial interest-rate effect on investment. In this paper, we examine the sensitivity of 
investment plans to interest rates using a set of special questions asked of CFOs in the 
Global Business Outlook Survey conducted in the third quarter of 2012. Among the 
more than 500 responses to the special questions, we find that most firms claim to be 
quite insensitive to decreases in interest rates, and only mildly more responsive to interest 
rate increases. Most CFOs cited ample cash or the low level of interest rates, as 
explanations for their own insensitivity. We also find that sensitivity to interest rate 
changes tends to be lower among firms that do not report being concerned about working 
capital management as well as those that do not expect to borrow over the coming year. 
Perhaps more surprisingly, we find that investment is also less interest sensitive among 
firms expecting greater revenue growth. These findings seem to be corroborated by a 
cursory meta-analysis of average hurdle rates drawn from firm-level surveys at different 
times over the past 30 years, which exhibit no apparent relation to market interest rates."

As Warren, Scott and Mike have been saying, fiddling with rates has a mostly neutral effect on the macroeconomy, since rates changes merely transfer purchasing power between lenders and borrowers. It seems that the Fed, and the CFO's that they surveyed, agreed. Also, farther down in the paper it was good to see them finding that income/revenue matters more than borrowing rates.

Full paper here