Rising Interest Rate is a good thing!

Discussion in 'Economics' started by HeSaidSheSaid, Jan 6, 2022.

  1. on the contrary, falling interest rate is a bad thing.

    Yahoo Finance
    December 16, 2015
    WASHINGTON (Reuters) - "The Federal Reserve hiked interest rates for the first time in nearly a decade on Wednesday, signaling faith that the U.S. economy had largely overcome the wounds of the 2007-2009 financial crisis.

    The U.S. central bank's policy-setting committee raised the range of its benchmark interest rate by a quarter of a percentage point to between 0.25 percent and 0.50 percent, ending a lengthy debate about whether the economy was strong enough to withstand higher borrowing costs". => then easymom had an orgasm!

    Van_der_Voort_4 and mac like this.
  2. maxinger



    Rising Interest Rate is a good thing!
    Rising & Falling Interest rates are good!

    when the interest rate is changing, it provides trading
    opportunities for the traders.
    When there is no change, it is no good!

  3. Cuddles


    holding bonds; can confirm
  4. Nine_Ender


    Some posters on here seem unaware this even happened. Markets were pretty strong in 2015 so anyone actively trading for a correction endured a tough year watching people make money. And some posters on here got so excited during the correction they forgot to go long. S2007S said 40-60% drop was coming AFTER the correction did it's thing.
    apdxyk and HeSaidSheSaid like this.
  5. ipatent


    Real or nominal?
    cdcaveman likes this.
  6. MKTrader


    You do know the relationship between bonds and interest rates, right?
    ElCubano, countryBoy641 and ipatent like this.
  7. MKTrader


    It might be okay to a point, but with the current level of government debt, rates can't go up too much or the level of interest on debt will be overwhelming.
    countryBoy641 likes this.
  8. Overnight


    Oooh, I think I know that one...

    MKTrader likes this.
  9. •how has holding bonds been working for you? charts show traders have avoided bonds, and you know the reason why, then do your own homework :)

    •I'd buy when markets tank. we can see this movie would have a good ending. (no not happy ending :)

    •a lot of regional banks were also on fire today (probably, not a good entry point now).


  10. Current U.S. Treasury rates:

    1 year - 0.450%
    2 year - 0.880%
    3 year - 1.15%
    5 year - 1.47%
    7 year - 1.66%
    10 year - 1.73%

    Why are these rates so low?
    Recent CPI prints are high single digits.
    Because ... maybe ... the U.S. Treasury can't afford to pay higher interest rates?
    So, to keep these rates so low, the FED has become one of the largest buyers of U.S. debt.
    But where does the FED get all this money?
    They don't have any money.
    So, they print it.
    Where is the inflation coming from?
    The FED.
    Are higher interest rates good?
    Only if you think that rising inflation is good.
    And it is certainly not good for non-investors - individuals without assets.
    Last edited: Jan 7, 2022
    #10     Jan 7, 2022
    MKTrader likes this.