Fed Rate Hike Sparks Market Decline: 'Every Hike Will Knock Down Stocks'

Financial markets took a hit on Wednesday after the Federal Reserve raised its benchmark interest rate for the first time in three years. The Dow Jones Industrial Average, which is sensitive to economic conditions, led the decline with a loss of 631 points or 1.2%.

The Fed's decision was made by Chairman Kevin Warsh, who stated that 'inflation is too high and has been for too long.' He added that the rate hike would support a return to the central bank's 2% inflation target.

Jim Cramer, a well-known financial expert, warned investors not to fight the Fed. He said that every rate hike from now on will knock down stocks and make it harder to invest in them.

Cramer noted that higher rates tend to slow economic activity by making borrowing more expensive and bonds more competitive with stocks for investment dollars. The 10-year Treasury yield is currently at nearly two-decade highs above 5%, which makes it an attractive risk-free return.