Interest rates zero forever?

Ariyahn2011 · 11 August 2015

What does that mean for new investors? Just seems normal cycles will not exist as easily anymore?
Basically the problem of kicking the tin down the street gets worse and worse. Is it greed? Can somebody please explain the situation to me and some of the likely scnearios..?

Thanks in advance..

Regards,
Ariyahn

Dona Ferentes · 7 March 2023

Sorry that nobody got back to you, but clearly , some 7+ years later, things are not different "this time". The tin got trampled in the rush to the exits and asset bubbles are unwinding. Debt is no longer your friend, but becoming rather toxic if it can't be serviced.

"Having spent the decade between the global financial crisis and the pandemic dealing with inflation that was too low, central bankers have, with very little warning, been presented with the opposite problem. At stake in confronting this is not just the mundane sounding problem of ‘maintaining price stability’, but the hard-won inflation fighting credibility of central banks themselves.

... so , by 2023, galloping inflation, rapid central bank action, tough times.

"Having initially been too slow to respond during the latter part of 2021, policy makers spent most of 2022 trying to get out ahead of the problem. The result was one of the fastest policy tightening cycles on record. From a financial markets’ perspective, most of the pain from this was felt during the first half of calendar 2022. From the end of December 2021 to the end of June 2022, global equity and bond markets fell considerably - in US$ terms, by 20.2% and 15.6% respectively. What was striking about these falls was both their magnitude, and the fact that both asset classes recorded such steep falls at the same time.

And a picture or two from the US :

investtrader · 15 January 2024

"In the longer term, we continue to expect neutral policy rates to decline to levels similar to, or slightly above, those seen before the pandemic." PIMCO.
It seems inflation in the US is tanking except for housing and services. I continue to think that the speed of rate rises will really crush demand in Australia. The effects have still not filtered through the real economy. It's going to be tough going for a while

divs4ever · 15 January 2024

investtrader said:
"In the longer term, we continue to expect neutral policy rates to decline to levels similar to, or slightly above, those seen before the pandemic." PIMCO.
It seems inflation in the US is tanking except for housing and services. I continue to think that the speed of rate rises will really crush demand in Australia. The effects have still not filtered through the real economy. It's going to be tough going for a while

i am expecting a series of waves caused by the consequences

inflation spike triggers wage demands , higher costs triggers higher prices , bigger investment capital needs trigger higher interest-rate coupons and maybe even rinse and repeat a couple of times

but keep watch for opportunities there will always be a few , and some that will be attractive

Interest rates zero forever?

Ariyahn2011

Dona Ferentes

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investtrader

divs4ever

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Interest rates zero forever?

Ariyahn2011

Dona Ferentes

Pengurus pengatur

investtrader

divs4ever

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