For all the hand-wringing and nervous forecasts, this week's Federal Reserve decision to raise interest rates may be a sign of better things to come.
History rarely repeats itself exactly. But a CNBC analysis of six rate-hike cycles over the last three decades shows that rising rates were often accompanied by falling unemployment, rising stock prices and solid economic growth.
That's not what many Fed watchers have been forecasting. Conventional wisdom holds that central bankers raise interest rates to put a damper on the economy and head off the risk of inflation. The move is like "taking away the punch bowl just when the party's getting started," a quip coined by William McChesney Martin, Fed chairman from 1951 to 1970.
That was certainly the case in the early 1980s, when the Paul Volcker Fed attacked a protracted period of double-digit inflation with back-to-back interest rate spikes that sent the economy into a "double-dip" recession. The cure worked, and interest rates had been on a downward path since.