Get ready for interest rate shock 2015

www.cbc.ca...

Seems the long awaited (and feared ) interest rate hikes are coming....
The Fed and Bank Of Canada will both be hiking their rates this year.....
The whole financial situation then becomes fluid.....everything will change......
Are there any financial prophets who can give us a preview?
I don't really think so.......
We are about to enter another phase of the NWO agenda methinks.....

Well all the jobs have been outsourced, they're decimating our shale oil industry with their little price war with OPEC, decimated the housing sector, placed a massive burden of debt on the new generation, positioned themselves for bail-ins using our money and made most of the citizens dependent upon the government they own. I guess they finally have everything in place-time to get the ball rolling.

Last time interest rates rose like that, it was 2008. The housing crash

This time the interest rates on variable student loans is going to increase too. Hard times for 50% of the student base that doesn't have a job.

Something is going to give this time, housing, insurance, student loans, the price of oil has already dropped severely. Another sign of the coming crash.

I have the feeling big things are about to break open....Perhaps we are seeing the prelude to .....well...not exactly ww3, but some heavy situations playing out......

Interest rates have been devastatingly and artificially low for years, effectively wiping out income for older people with savings who depended on a return on investment. Look back hundreds of years and you'll see 4% return is about average. Compare that to today's 1/2 percent and you see the problem. I'd love the rates to go up so I could start making some money instead of losing ground. And I'll be happy to pay the taxes on it.

originally posted by: schuyler
Interest rates have been devastatingly and artificially low for years, effectively wiping out income for older people with savings who depended on a return on investment. Look back hundreds of years and you'll see 4% return is about average. Compare that to today's 1/2 percent and you see the problem. I'd love the rates to go up so I could start making some money instead of losing ground. And I'll be happy to pay the taxes on it.

Glad to hear YOU LL be OK

The economy will not improve until the interest rates go up. Say around 6 to 7 percent. They have been way to low for way to long.

I'm in my first home- purchased in 2010.

Due to some setbacks, I'm not ready to sell this year- which was the plan from the start.

If things play out the way its looking, I'll be ready just in time for this whole area to turn into a slum.

Living in a starter home, surrounded by old folks- I watch 3-8 new wheelchair ramps get installed around here every year. Their kids live elsewhere, their grandkids will never be able to afford to buy.

I had a shot to sell this place to a starting family- three bedrooms, one bathroom, an office space, nice kitchen.

Hopefully the people in charge push the collapse off just another year or two and give me a chance to catch up and get the hell out of here

Try to see the bigger picture a little harder......your plans are not what the PTB care about....

a reply to: stirling


I would think the ptb would rather have your interest payment and not a trashed house in repo. Do they not make more money when the economy is strong? Or do you think they have some other objective?

a reply to: schuyler

Exactly.

Good for investors, not so good for borrowers.

Interest rates have been falsely low in an attempt to desperately hang onto the reserve petrodollar.

An increase in interest rates can only mean one thing: the petrodollar is no longer sustainable and the feds are throwing up their arms in defeat... or they're attempting a new game play to turn it back into their favour.

Either way, it seems the global economy is in for some major upcoming changes.

originally posted by: schuyler
Interest rates have been devastatingly and artificially low for years, effectively wiping out income for older people with savings who depended on a return on investment. Look back hundreds of years and you'll see 4% return is about average. Compare that to today's 1/2 percent and you see the problem. I'd love the rates to go up so I could start making some money instead of losing ground. And I'll be happy to pay the taxes on it.

You are so right!

The interest rates, while great for me and my kids when we bought new houses in the past 5 years.

It has devastated my mother (80's) and my aunt (90's) retirement savings.

There is a disincentive to save when interest rates are artificially low,
and our economy has reaped the consequences
when people lose jobs they have nothing
to sustain them and have to go on the dole.
Which has become so common that people are
no longer ashamed to live off the hard work of mainly the middle class
and not look for work at all.

The powers that be know there is only one way to pay off the massive debt
that Obama and his cronies have gotten us into
he alone doubled the debt in 6 years
after saying that the debt when he took office
was unpatriotic and had to be brought down (lair)
The only way to pay off the debt Obama mainly now
and his predecessors got the US into
is to raise interest rates
and cause massive inflation.

The ones who will benefit are those who
have savings or can save
and it is about time we
rewarded the middle class hard worker
rather than the generational welfare class
with interest rates that encourage saving

It actually has to be done to save the
US economy from total annihilation
the debt is now unpayable
unless there is rampant and
extremely high inflation
accompanied by sky high interest rates.

a reply to: lordcomac

You situation is exactly why my daughter's realtor told her not to purchase a starter home after she got married.

He told her they should buy the biggest house they could afford, so they looked at their rent and shot for a payment as close to that as possible and purchased a very nice 2500sq ft house. Some family members helped with the down payment so they could purchase while the rates were so low. I am soooooo glad she did. My nephews are struggling to get out of their "starter" homes now that they have children. My oldest lost a ton of money on her "starter" home when she purchased her "dream house" this year.


Moral of the story: buy as big a house as you can afford right now, don't buy a "starter" they are money losers, and then hold onto the house you buy as long as possible and ride out the coming inflation and inevitible, economy saving, interest rates.

originally posted by: Hoosierdaddy71
The economy will not improve until the interest rates go up. Say around 6 to 7 percent. They have been way to low for way to long.

Under Carter, who did not quite as bad a number on the economy as Obama has,

interest rates had to go up to 14% (correction 18%) before the economy rebounded

and stabilized again.

That is what we should expect.

a reply to: grandmakdw

They kept going up after carter was gone to. Mortgages rates of 18% were common. But that is to high....

originally posted by: Hoosierdaddy71
a reply to: grandmakdw

They kept going up after carter was gone to. Mortgages rates of 18% were common. But that is to high....

That is true, and probably what is destined to happen in an attempt to stabilize the economy and pay off the currently unpayable debt (unless there is sky high inflation, which will pay off the debt).

My sister had a mortgage where her interest rate was 17%, you jogged my memory on that one. They took a real hit on that house when they had to move for job purposes.

I agree it is way to high,
but also I think quite likely to happen because of the current debt level,
there just isn't any other way to pay it off but to cause runaway inflation,
through manipulation of interest rates.
You and I have seen this in our lifetime,
and I think we are entering a time where it will happen again.
After the debt is brought down through rampant inflation
then we'll enter another cycle of low interest rates, but that won't be for another 20-30 years at best.
I think 5%-8% is probably the most stabilizing rate levels.
However, there will need to be
the up to 14%+ in order to save the economy,
before returning to sane levels.

The next President will necessarily preside over a "misery index" like we saw during the Carter era in an effort to save the US economy.

originally posted by: AzureSky
Last time interest rates rose like that, it was 2008. The housing crash

This time the interest rates on variable student loans is going to increase too. Hard times for 50% of the student base that doesn't have a job.

Something is going to give this time, housing, insurance, student loans, the price of oil has already dropped severely. Another sign of the coming crash.

You are off by a lot of years.

The last time interest rates went sky high was during the Carter years.

After the peak at what I've been told was actually 18%

The economy went into the biggest expansion since the roaring 20's

the debt was nearly paid off

and things were never better in the US.

2008 was a blip

You ain't seen nothin yet!

In order to save the economy last time around
we had to have 18% interest rates
inflation so bad that prices rose exponentially every time you went to the store
homelessness was rampant
it was horrible to live through
for those supporting families

But I see no way out of it now
there is absolutely no other way
out of the debt that
Obama and his liberal/progressive/Dem policies and cronies
have rung up (doubled the debt in 6 1/2 years)]/b]

edit on 12Mon, 05 Jan 2015 12:02:13 -0600pm10501pmk051 by grandmakdw because: format

originally posted by: grandmakdw
a reply to: lordcomac

You situation is exactly why my daughter's realtor told her not to purchase a starter home after she got married.

He told her they should buy the biggest house they could afford, so they looked at their rent and shot for a payment as close to that as possible and purchased a very nice 2500sq ft house. [...]

Sadly, this starter house is not only the 'biggest' house I could afford (820sqft, will be 1200 when I'm done) with a monthly payment of $1300 a month (and ~300-400 in utilities, where I can rent an apartment closer to work for 700-900 that includes utilities) but I had to take out two different mortgages to afford it.

My second best option was to move about 150 miles from here and buy an old broken down farm house for about half the price (but oddly still about 900/mo in payments)- but to do that, I'd have to give up my job- and thusly not have the money to make the payments.

It's a very different situation in one geographic area to the next. My plan was to sell this place (yes, even with my improvements I didn't really expect to sell it for more than I paid)- but I'd have more coming out than I had going in since I'm putting a little extra into the payments, and theoretically make more money than I did, too- as well as have had a mortgage under my belt, improving credit to take a bigger loan the next time around.... blah blah blah.

I just want to get out of here, buy a plot of land, and start a garden so I've got food when this all comes crashing down.

a reply to: stirling

You would see interest hiking to curb inflation (weakening of the Dollar), but right now it`s strengthening big time, so QE to devalue the Dollar would be more expected.

It`s also something which is tied to good economy growth (with all the fake numbers you might think that`s happening, but it isn`t).

The fall of oil prices will hit the US (and World economy) also hard bringing the US "growth" caused by the shale boom down big time.

Jeff Gundlach: "If Oil Drops To $40 The Geopolitical Consequences Could Be Terrifying"

Source

"There Is Moar Blood" WTI Crude Plunges Into The $40s

Source

You can only hope Jim Willie isn`t right and we still have a few years left before it all blows up.

Jim Willie: We’re in the END GAME: The Dollar Will Rise Just Before it COLLAPSES!

Source

The most logical thing to offset the strengthening of the Dollar which is taking place right now is to print more (QE) and not to strengthen it (hike interest).

The blow up of countries and junk bond because of the collapse of the oil prices is what needs more of your attention at the moment...it sure looks we are going back to the late `08 and early`09 situation (if we`re lucky and it doesn`t get worse than that).

a reply to: BornAgainAlien

It will get worse, it has to in order to save the economy from
the current debt level
which economists say is unpayable
without rampant inflation
and double digit interest rates

2008 my dear is nothing, that was fairly prosperous compared to what we saw in the Carter years

I fear we will have to return to the
Carter economy which
makes 2008-09 look like happy days
before stabilizing again.