Interest Rates – Where Are They Going?
February 7th, 2005 - 4 CommentsWhat is going on in the world today? I have no idea and I really don’t know why interest rates are still so low in this country. Fuel prices have soared to levels never seen in this country. Food costs for staples like milk and beef have gone out of control. Home prices, well you don’t need me to tell you about home prices do you? The bottom line is that inflation has been ignored as a problem by the current administration as well as Mr. Greenspan and Congress. I am not sure why this has really been allowed to persist. I was beginning to think that I was way off base this whole time until I had the chance to speak to someone for a couple of hours yesterday. I am not going to mention any names, but he could be one of the most powerful, weathly and influential people I will ever have the fortune to speak to. We discussed a number of things, but when it came to interest rates, we seemed to share the same exact view. It was strange and exciting all at the same time. He mentioned that they were so convinced that rates were going to rise over the past year and a half that they had put together a portfolio of junk bonds. He went on to talk in more technical terms about why he felt rates were out of touch with the market, but the bottom line is that we were on the same page.
So, if Alan Greenspan is reading this, I would love to hear why it is you and the Fed feel it has been ok to let rates stay low for so long? Why you think it is good for the US economy and the citizens of the United States to purchase homes with no money down, 100% financing and interest only payments? How is this helping the US as an economy and a community?
? we are waiting for forclosures to purchase property at a price that is in more in line with what things actually cost. What do you think?
I think you have a while before you are going to want to buy something. You don’t want to buy something simply because it is a forclosure. IMHO, you want to wait for prices to stabilize before jumping into a market with both feet. But, there are always *deals*.
Rates are so low because China is the one holding all the debt.
The US has to keep the rates reasonably low or half the nation will go into foreclosure.
I agree though, it seems like a ticking time bomb.
I am so disgusted with the low interest rates in this country. I have researched many banking sites on the web and decided that I’ll be doing internet banking. I did find some that have around 5% APY, where my local bank is giving me an APY of .60%. This is why there might be a lack of savings in this country – because of the lack of incentives. I’m not talking about IRA’s or 401’s, only straight savings. With fuel, grocery, and other consumer necessities rising beyond a reasonable rate, I’m surprised that banks are allowed to treat their customers terribly. I hope to encourage all others to do on line banking or at least change their bank account if they can find one with a higher rate. One piece of advice is to make sure it’s fully FDIC insured and there are no fees to open or close an account. I’ve also decided to make my future purchases count – buy only what I need, not what I want. If more people do this, politicians may listen and change a few rules for the good of the consumer.