High Interest rates to prevent meaningful economic recovery?

patslatt

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Apr 11, 2007
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13,637
Availability of credit apart,when interest rates are at low and high extremes,they can be the most important factor in economic growth or lack of it. With the government paying nearly 7% for 10 year bonds,corporations will have to pay even more,maybe in the range of 9 to 11%. Given low price inflation and even some deflation in the economy,such interest rates are punitive and make it unfeasible to undertake most long term capital investments. Interest rates over three to five years are lower,however,but is that enough to allow meaningful economic recovery?
 


Ulster-Lad

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Joined
Oct 26, 2006
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9,989
+1 Agreed. In addition don't forget that the stronger the value of our Euro it will also hinder whatever exports we have. Buyers are simply will not want to buy from us when they can get goods much cheaper in China or the US.

The stronger the Euro the worse off we are.
 


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