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The FED just cuts and cuts. What will cause them to raise rates to levels of 10% or more? Why don't they just lower the rate to 0% and give money away? Is there anything that can cause rates to increase?
Rates aren't going anywere but a bit lower in the future once things get jump started much later down the road then they may raise a bit but 10% it ain't gonna happen
Easy credit is the problem.We had high interest during the recession in the 70's and it hurt the economic recovery. Just like tight credit even for those that are credit worthy in keep much of the wheels from turning. Then the inflation b eing in double digiotsd really hurt.
Rates are raised to tighten up credit and reign in money from the market or system
Rates are lowered to loosen up credit and flood the market or system with money
The Fed could step aside and let The Market decide what interest rates should be. Then, when home prices got higher, interest rates would get higher (eventually, driving down home prices) and when home prices got lower, interest rates would get lower (eventually, driving up home prices). In this way, the market self-corrects or maintains balance. The Fed is what they call: government intervention, big government, socialism, meddling, etc, etc. It would be nice if the market paid more attention to fundamentals and less attention to The Fed. However, with our current system, that would be incompetent
I wish the rates would rise! I'm getting almost nothing on my investments! A higher interest rate translates into more interest on savings!
If you buy a house, the interest is tax-deductible--you get it back--so it really isn't that much of an issue.
I'd rather get more for saving my money, than being charged for spending it!
IF the money the Fed is giving the banks was circulating then, yes, they could start raising the rates slowly. But the money is not circulating..lines of credit are frozen or being called in, loans are hard to come by. There is no excess money in circulation.
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We Could Just Let The Market Do It
