Posted on Sep 20, 2015
Do you think Yellen made the right decision to not raise interest rates for now?
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http://economictimes.indiatimes.com/markets/stocks/news/why-feds-decision-not-to-raise-rates-may-have-deepened-investors-fears/articleshow/49009045.cms
Although the Feds have said all summer they are going to raise the rates, they decided at the last minute not too....Rates have been down since 2008....They have been artificially low for far too long...and by keeping them low is going to hurt the US as a whole in the long run.
Using China and current low employment and other things as an excuse to keep the rates super low, to me is not a good one.
Yes, it's been awesome for a whole lot of people....the housing market started to boom again which is awesome, but it's hurt many too. Interest paid on CD's and other savings vehicles are super low...so it's give and take...
Now the Feds say they will raise rates in December...this is like the third time they've put off the inevitable. Do they really think that December is going to make a difference or be any better?
Although the Feds have said all summer they are going to raise the rates, they decided at the last minute not too....Rates have been down since 2008....They have been artificially low for far too long...and by keeping them low is going to hurt the US as a whole in the long run.
Using China and current low employment and other things as an excuse to keep the rates super low, to me is not a good one.
Yes, it's been awesome for a whole lot of people....the housing market started to boom again which is awesome, but it's hurt many too. Interest paid on CD's and other savings vehicles are super low...so it's give and take...
Now the Feds say they will raise rates in December...this is like the third time they've put off the inevitable. Do they really think that December is going to make a difference or be any better?
Finance
Economy
Edited >1 y ago
Posted >1 y ago
Responses: 7
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Absolutely not! We continue living off the credit card ( National Debt) and phantom money (federal Reserve). It has been years and the current balance sheet from them shows that there will be over $4T in debt to be reentered into the economy at some point. That means that now those of us with money in CDs, bank accounts and other cash income producing products are taking it in the shorts, while banks and Wall Street is flush at our expense. The Fed should be eliminated as a unit that has the responsibility for the stabilization of the dollar. They have failed miserably, and there is no recourse through Congressional oversight.
http://www.federalreserve.gov/releases/h41/Current/
http://www.federalreserve.gov/releases/h41/Current/
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SPC Steve Bright
The Fed is NOT responsible for a stable dollar but rather for stable rates and employment which lead to a stable dollar.
Second, the lower rates are good for the markets. Higher rates will slow the economy — something we can not afford at this point in time.
Third. Your presumption that lower rates benefit the markets at the expense of savings accounts is wrong because it assumes the two are of equal risk, they are not.
As to looking at debt, you need to look at debt to GDP, not total debt. This is an inaccurate approach when considering debt relative to history.
Second, the lower rates are good for the markets. Higher rates will slow the economy — something we can not afford at this point in time.
Third. Your presumption that lower rates benefit the markets at the expense of savings accounts is wrong because it assumes the two are of equal risk, they are not.
As to looking at debt, you need to look at debt to GDP, not total debt. This is an inaccurate approach when considering debt relative to history.
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MCPO Roger Collins
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No. It is time for the free ride to end. The near zero interest rates have really hurt many seniors by wiping out a large part of their income in a misguided effort to help "the poor".
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SPC Steve Bright
Low rates are here to keep the economy going. When rates are low, inflation is low and low inflation helps senior citizens. Higher rates will bring on inflation and hurt seniors even more so. The real issue for seniors is medical expenses which are not correlated to rates.
As to why rates are kept low it is not to benefit the poor but to keep the economy going while things are difficult. Lower borrowing costs for businesses so they are more likely to borrow and invest in jobs.
As to why rates are kept low it is not to benefit the poor but to keep the economy going while things are difficult. Lower borrowing costs for businesses so they are more likely to borrow and invest in jobs.
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Sgt Kelli Mays In my opinion, it was a political decision, not an economic decision. The longer they wait, the more pain we will all feel. The Mises Institute is a great resource why fiat currencies will destroy an economy and country.
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Sgt Kelli Mays
You hit it right on the nail! It's political...not economical...which in the long run....the longer we keep rates low...the harder the re adjustment is going to be....and the lower the economy will go before it can come back and level off to where it really should be. WE are in a FALSE pre arranged adjustment that is not good...yes, it's great for the home owners who have purchased and or refinanced during this period, but OVERALL...it's not a good thing. Most people don't know or understand this....but being in the financial business I get it and see the big picture...it's just another obama legacy so to speak that's going to blow up after he's long gone out of office...
Don't you think it's funny that Yellen said when she takes office she's raising rates and all of the sudden she changes her mind....I am pretty sure she is receiving a WHOLE lot of pressure from the Liberals to keep the rates artificially LOW as they are.
Don't you think it's funny that Yellen said when she takes office she's raising rates and all of the sudden she changes her mind....I am pretty sure she is receiving a WHOLE lot of pressure from the Liberals to keep the rates artificially LOW as they are.
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Sgt Kelli Mays - Sergeant; What level do you suggest that the Fed raise its interest to?
Please remember that every step down the financial ladder that you go from the Fed means that that interest rate is going to be hiked so that when it reaches the "mortgage consumer" a 0.5% increase is likely to translate into a 2.0% increase (which doesn't sound like much by can result in people being forced out of their homes because they can no longer afford their mortgage payments [and those aren't "junk mortgages" either]).
Please remember that every step down the financial ladder that you go from the Fed means that that interest rate is going to be hiked so that when it reaches the "mortgage consumer" a 0.5% increase is likely to translate into a 2.0% increase (which doesn't sound like much by can result in people being forced out of their homes because they can no longer afford their mortgage payments [and those aren't "junk mortgages" either]).
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Sgt Kelli Mays
the lower rates are allowing people to buy much larger homes....that they should not be purchasing in the first place. Those that refinanced and or purchased during this time should be ok...but the rates are artificially low...it's hurting a lot of people...people who save by CD's or money market or other forms of savings that are based on rates...are receiving nearly nothing on their money...the government lending money at such low rates is doing nothing but falsely improving the economy....
This lowering of the rates was suppose to be a temporary thing...for a few years...to help the economy get back up....our economy is on a false fix and when rates slowly start going up in tiny increments, the economy will get back to where it really should be....but now it's going to take a really long time because there is going to be a lot of catching up which is more than likely going to cause a huge decline in our economy for a while.
People are not going to be forced out of their homes...unless they were stupid enough to get themselves into an ARM...otherwise 92% of all home mortgages are fixed rates...so when rates rise, it's not going to affect those already owning their homes because their rates will not rise.
This lowering of the rates was suppose to be a temporary thing...for a few years...to help the economy get back up....our economy is on a false fix and when rates slowly start going up in tiny increments, the economy will get back to where it really should be....but now it's going to take a really long time because there is going to be a lot of catching up which is more than likely going to cause a huge decline in our economy for a while.
People are not going to be forced out of their homes...unless they were stupid enough to get themselves into an ARM...otherwise 92% of all home mortgages are fixed rates...so when rates rise, it's not going to affect those already owning their homes because their rates will not rise.
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COL Ted Mc
Sgt Kelli Mays - Sergeant; How do you define a home that is "bigger than it should be"?
FYI the current mortgage rate in Canada is around 2% and even allowing for the fact that mortgage interest is NOT deductible that works out to less than the current US mortgage rate of 3.9%. According to all of the financial studies available, the Canadian banks are MUCH sounder than the US banks (although "soundness" is a rather ephemeral quality when the government simply could not afford to have a major bank go under and start a panic).
FYI the current mortgage rate in Canada is around 2% and even allowing for the fact that mortgage interest is NOT deductible that works out to less than the current US mortgage rate of 3.9%. According to all of the financial studies available, the Canadian banks are MUCH sounder than the US banks (although "soundness" is a rather ephemeral quality when the government simply could not afford to have a major bank go under and start a panic).
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Lower Interest rates are used to stimulate growth while higher ones regulate inflation. We are below tagets on economic growth and inflation so keeping the rate low was the expected call. Keeping it at zero was a little less expected but not as apocalyptic as the article implied.
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Sgt Kelli Mays
It's been too low for far too long and it's actually not good for the economy. The longer the rates stay low, the more it'll hurt in the long run. When Yellen first took office last year she said she was raising the rates...since then she's said it three times...and here we go again....now it's supposedly going to be raised in December... Then what...in December it's going to be ok....not now...in a few more months.... The lower rates are artificially boosting the economy...therefore it's not a TRUE assessment.
I know that it's awesome the rates are super low and have been for quite some time now, but it's time to bring rates to where they should be and let the economy adjust accordingly to where it really should be.
I know that it's awesome the rates are super low and have been for quite some time now, but it's time to bring rates to where they should be and let the economy adjust accordingly to where it really should be.
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Yup ... need a couple more quarters and then we can start ratcheting up the interest rate.
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Sgt Kelli Mays
why a couple more quarters? then it'll be a couple more, then a couple more. Yellen has said since she took over in 2014 that she was going to raise the rates soon as she took office. We have a FALSE POSITIVE on our economy...it needs to be a TRUE assessment.
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Not sure if it's the "right" decision, but definitely a welcomed one for those wishing to prolong purchasing for additional options...
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Sgt Kelli Mays
Yes sir MSgt Ellis....it most certainly was a very welcomed event...the lowering of rates was supposed to have been a very temporary thing....2 to 3 years at the most.....and it was an economical thing/issue...but then it became political....and well...now it's a problem.
Had the rates stayed low for the period of time it was supposed to have then reversed and changed back to where they should be...we would have already plateaued out and our economy would have adjusted and we would be at a TRUE assessed over view of the economy as a whole...but unfortunately the rates stayed artificially low...and then went even LOWER for about a year...and inched back up, but is still very very low.
Yes, it helped a lot of people lower their monthly payments by being able to lower their interest rate. Yahooo! and it allowed many people to purchase homes at a much lower rates....but this actually is not as good because for the past 8 years people have been purchasing homes that normally would be out of their budget, but because of the lower rates, they can purchase more of a house.
The longer the rates stay super low, the harder it is going to be to raise the rates and for the economy to adjust...so what would have only taken a few years for the economy to adjust, is going to take a very long time...and even may cause the US to go into a depression era now...
The rates need to be raised....very very slowing and over a period of time...this way it won't cause such a deep cut into the economy and hopefully not put us into a downward spiral and or depression...
Had the rates stayed low for the period of time it was supposed to have then reversed and changed back to where they should be...we would have already plateaued out and our economy would have adjusted and we would be at a TRUE assessed over view of the economy as a whole...but unfortunately the rates stayed artificially low...and then went even LOWER for about a year...and inched back up, but is still very very low.
Yes, it helped a lot of people lower their monthly payments by being able to lower their interest rate. Yahooo! and it allowed many people to purchase homes at a much lower rates....but this actually is not as good because for the past 8 years people have been purchasing homes that normally would be out of their budget, but because of the lower rates, they can purchase more of a house.
The longer the rates stay super low, the harder it is going to be to raise the rates and for the economy to adjust...so what would have only taken a few years for the economy to adjust, is going to take a very long time...and even may cause the US to go into a depression era now...
The rates need to be raised....very very slowing and over a period of time...this way it won't cause such a deep cut into the economy and hopefully not put us into a downward spiral and or depression...
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MSgt Curtis Ellis
Sgt Kelli Mays - As I said,I'm not sure that it was the "right" decision... We will all pay for it at some point, some more than others, but we will pay for it... but for now?
Luke 12:19-20
"19 And I will say to my soul, Soul, thou hast much goods laid up for many years; take thine ease, eat, drink, and be merry.
20 But God said unto him, Thou fool, this night thy soul shall be required of thee: then whose shall those things be, which thou hast provided?"
Luke 12:19-20
"19 And I will say to my soul, Soul, thou hast much goods laid up for many years; take thine ease, eat, drink, and be merry.
20 But God said unto him, Thou fool, this night thy soul shall be required of thee: then whose shall those things be, which thou hast provided?"
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