Get your shit together -- interest rates may be going up
The Bernankester said so -- from Walter Russell Mead at
The American Interest:
Fed Chief Warns Homebuyers: Time To Lock In Those Low Rates
Central bankers make it their business to be Delphic most of the time, but Ben Bernanke�s recent remarks drive us toward two conclusions. �In light of the current low interest rate environment, we are watching particularly closely for instances of �reaching for yield� and other forms of excessive risk-taking, which may affect asset prices and their relationships with fundamentals,� he said, according to the FT.
Now, first, with many US stock indices at all time highs despite slow economic growth, this is something of a yellow flag. If the Fed gets out of the business of inflating the stock market, equity investing is not going to be quite as much fun.
Second, if you�ve been toying with the idea of refinancing your home or taking out a mortgage, it�s time to get in gear. US interest rates seem headed up after their long, sedated nap. Locking in a nice long term mortgage at some of the lowest rates since time began seems like a good idea, and if Bernanke is right, these rates won�t last.
So the low-interest bubble is about to crash and they are marketing it as yet another '
easing'. Only problem is that the interest we pay on our debt to China is pegged in part to our internal interest rates -- if this raises, we will be further in debt to our Asian enablers. Interesting times indeed...
Posted by DaveH at May 11, 2013 10:22 PM