The Era of Very Low Inflation and Interest Rates May Be Near an End
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Re: The Era of Very Low Inflation and Interest Rates May Be Near an End
#2So our savings will be inflated away at an only a slightly slower pace now? How kind of the Federal Reserve!
Re: The Era of Very Low Inflation and Interest Rates May Be Near an End
#3I'm not familiar with a world where interest rates and inflation aren't low. What should I expect?
Re: The Era of Very Low Inflation and Interest Rates May Be Near an End
#4I'm not familiar with a world where interest rates and inflation aren't low. What should I expect?
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Re: The Era of Very Low Inflation and Interest Rates May Be Near an End
#5> So as long as the moves don’t go too far, increases in inflation and interest rates would be a sign the global economy is returning to a more prosperous equilibrium like the one that prevailed before 2008.
Pre-2008 was quite far from a prosperous equilibrium, otherwise it wouldn't have caused the crisis.
Re: The Era of Very Low Inflation and Interest Rates May Be Near an End
#6I'm not familiar with a world where interest rates and inflation aren't low. What should I expect?
Loans cost more. The interest rate on my first mortgage (in the 90's) was 7%.
Re: The Era of Very Low Inflation and Interest Rates May Be Near an End
#7I am not buying that inflation is low. Property taxes and housing cost (especially rent) has doubled in last 10 years in New York. I think so has the medical costs. Just because gas prices are low dose not mean inflation is low
Re: The Era of Very Low Inflation and Interest Rates May Be Near an End
#8I'm not familiar with a world where interest rates and inflation aren't low. What should I expect?
> inflation aren't low
Inflation is only low if you trust how the Federal Reserve is calculating it. Personally, I think the weightings they assign to various categories are intentionally incorrect.
Anyone who lived through 2008 knows better than to think inflation was sub-2% -- yet many savings accounts have been paying 0.01% interest for over a decade.
The fed's monetary policy is taxation without representation.
Re: The Era of Very Low Inflation and Interest Rates May Be Near an End
#9I'm not familiar with a world where interest rates and inflation aren't low. What should I expect?
Me neither, but I tend to think we'll not find out very soon. The article is heavily biased towards the US economy, meanwhile the EU, Japan still struggle with ~0% yields. Hell, Japan's been doing it since 1992.
Re: The Era of Very Low Inflation and Interest Rates May Be Near an End
#10"And if threats of a trade war with China or other countries turn into reality, this will tend to increase inflation, driving up prices both directly through new tariffs on imported goods and indirectly by encouraging less efficient production."
...I'm confused as to why either of those effects are supposed to be good things.