Fed Insider says Interest Rates will be Raised Repeatedly

a reply to: burdman30ott6

Yes but raising interests rates will affectively reverse inflation due to the fact that they will essentially be restricting the amount of cash.

The housing market needs a massive correction it's out of reach of Millennials.

originally posted by: toysforadults
a reply to: burdman30ott6

Yes but raising interests rates will affectively reverse inflation due to the fact that they will essentially be restricting the amount of cash.

The housing market needs a massive correction it's out of reach of Millennials.

Raising interest rates will do the opposite of helping for anyone trying to afford a house. Domestically, raising inflation rates will raise costs of pretty much everything Domestically produced and sold. In other words, it will cause domestic inflation. When the Fed talks about "deflation bad!!!" They are only viewing it from a globalist ice sense, not a domestic benefit sense. Raising rates will reverse the global inflation of the dollar, that much is true.

a reply to: burdman30ott6

Yes I'm well aware of this and the ones who stay in this market will also have to adjust their prices in order to remain competitive meaning consumers can save more money.

originally posted by: burdman30ott6

originally posted by: toysforadults
a reply to: burdman30ott6

Yes but raising interests rates will affectively reverse inflation due to the fact that they will essentially be restricting the amount of cash.

The housing market needs a massive correction it's out of reach of Millennials.

Raising interest rates will do the opposite of helping for anyone trying to afford a house. Domestically, raising inflation rates will raise costs of pretty much everything Domestically produced and sold. In other words, it will cause domestic inflation. When the Fed talks about "deflation bad!!!" They are only viewing it from a globalist ice sense, not a domestic benefit sense. Raising rates will reverse the global inflation of the dollar, that much is true.

Inflation is also good for those in debt. Inflate away the debt.

a reply to: burdman30ott6

It depends on how it's done and over how much time. If the goal is to remove excess liquidity from the system to control inflation you need higher interest rates. As low as they are now any move upward that is drastic would not serve that purpose. You have to whittle down the supply over time. This is the Fed trying to call back its inflation bomb after it already hit the target.

As a poster said before, the Fed is slow, and moreover they are arrogant. They really think they can control the dollar like this, while pretending to 'save' the economy.

If they had followed a much earlier timeline and phased out QE...say 5 years ago, we wouldn't be worried about interest rate hikes causing out of control inflationary pressures.

But I think that was the idea.

originally posted by: projectvxn
a reply to: burdman30ott6

It depends on how it's done and over how much time. If the goal is to remove excess liquidity from the system to control inflation you need higher interest rates. As low as they are now any move upward that is drastic would not serve that purpose. You have to whittle down the supply over time. This is the Fed trying to call back its inflation bomb after it already hit the target.

As a poster said before, the Fed is slow, and moreover they are arrogant. They really think they can control the dollar like this, while pretending to 'save' the economy.

If they had followed a much earlier timeline and phased out QE...say 5 years ago, we wouldn't be worried about interest rate hikes causing out of control inflationary pressures.

But I think that was the idea.

Well QE was a incredibly inefective way to stimulate the economy (pushing on a string).

However once implemented trying to dial it back to early would even worse.

My sons morgage is 3 % when he had a car bought on time the car was zero .
Heck right now the low rates are good for lower class it is easy to get a house have a job paying 12 $ a hour have anything over 660 score and your good to go .

BUT I am now all for a Raise now he has his house he payed 110 k for so a raise back to even 7 % will incress the house value quite nicly .

The icening on his cake would be the house being worth 150 k in 3 years instead of 30 .
as to the fact this is what causes all our problems well cant change it may as well use it .

originally posted by: Phage
a reply to: CB328
Actually, it doesn't really take an insider to know this.

If interest goes up to much people will have to pay noticeably more for car and home loans,

Guess what? It also means that interest on savings will go up.

According to my bank, those days of high interest returns on savings/investments are over. We lose, the banks win. There is really no debate.

Either invest in real estate, or the stock market, or get no return on your investments.

a reply to: midnightstar

BUT I am now all for a Raise now he has his house he payed 110 k for so a raise back to even 7 % will incress the house value quite nicly .

I'm not sure I follow why raising the interest rate will increase the value of the home? It will likely do the opposite if you try to sell it. and not rent it.


When interest rates rise the buyer has to pay more for the same and to compensate for that , the market will likely lower the prices of homes.

simple calculator
If your son purchased his house for 110K at 3% interest rate his payment will be around $464 a month for 30 years total cost of loan 166,955.

Now a new home buyer who purchases the house for say the same amount 110K at 7% interest rate his payment will be around $732 a month for 30 years total cost of loan 263,460.

People are overpaying for houses now because the interest rates are low. Once the interest rates go up , the cost of housing will go down or stay near the same at best. The ones that don't need to sell will be OK , it will be the ones that need to sell that will be in trouble.

a reply to: CB328

The only way they don't go up is if the economy is tanking.Them going up is not bad.