U.S. Interest Rates Will Rise Sharply

[No DUplicitous DUpe]

U.S. Interest Rates Will Rise Sharply
posted with permission from http://sane-ramblings.blogspot.com/

Interest rates will rise sharply. It first started slowly as 2009 ended and with some fluctuation up and down, rates will keep rising. Why is this happening and how can you benefit by it or protect yourself from it?

It is happening because the U.S. government is running massive deficits, projected for years to come. To pay for these deficits without raising taxes, the money must be borrowed and the government is borrowing heavily.

The week of December 28th alone, the Treasury Dept. raised a record tying $118 billion dollars after a worldwide appeal for funds.

The dollar is backed by only the confidence people have in it and foreign creditors including China and Japan, already hold half of the Treasuries and they are nervous.
At the end of 2009, they demanded higher interest rates and got them and they will in 2010 and beyond. The government must pay it because it desperately needs cash.

How can you benefit? If you have savings, commit them for months, rather than lock in for years and in the months to come, you will be paid higher rates than the near zero you're getting now. If you are a borrower, take advantage of today's low rates and borrow long term fixed rate.

If you are an investor, look into highly reputable hedge funds that are positioning to capitalize on the higher interest rates to come.

From the government borrowing so much money and printing the additional funds it needs out of thin air, we will eventually be confronted with hyper-inflation and far higher interest rates.

I have nothing to sell you. The intent is to call this to your attention so that you can benefit by it and as need be protect yourself from it. We are all in this together and we will get through it and hopefully build a far better nation, one that takes fiscal responsibility seriously.

[Nikki Stone1]

1. Do that refi NOW!

/

[virgogal]

2. As a saver that's good news for me.

[DesertFlower]

4. same here. nt

[msongs]

7. finally a reward for people who live on their income and save money nt

[marybourg]

3. Actualy, short term rates are rising because they at at record lows,

nearly 0, and have nowhere to go BUT up. Long term rates are rising for several reasons, including the one pointed out in the OP, but also because the economy is improving. the Op seems to me to be another anti-Obama screed. Maybe it should be re-directed to Freeperville; I'm very disappointed to see it here.

[No DUplicitous DUpe]

8. Anti-Obama? Freeperville? I think not...

Here is another of the OP's columns...Does that sound like it belongs in Freeperville? Anti-Obama, no...Anti-war? yup

Where Is Your Conscience?
http://sane-ramblings.blogspot.com/2009/05/where-is-your-conscience.html

Speaking to you as a man who has conducted 166 candlelight vigils for all those who have paid so severe a price in Iraq, and all those who will, where is your conscience?

How can you go on with your life as if this wasn't happening? Where is your compassion?

Men, women and children are being killed in Iraq and for what? What do you think this will accomplish?

More than 6 years ago, the U.S. illegally invaded that nation. Iraqis didn't ask the U.S. to do so nor were they given a choice or a voice. And for all the years since, they have lived under a military occupation.

Over a million Iraqis have been killed, no-one knows how many have been severely injured, 21/2 million have fled their nation and 2 million more hide within it. Nor does anyone know how many orphans there now are.

There are no longer schools for many of the Iraqi children to attend, electricity is a luxury and so are clean water and sewage treatment. Unemployment is 40 - 50%, twice that in the U.S. during the 1930's Great Depression.

Medical care is in short supply because so many doctors and nurses have fled. There is also a shortage of medical supplies because much of it trades on the black market. Does any of this bother you enough to raise your voice on behalf of those who have no voice?

And what about the American soldiers and their allies? More than 5,000 if them have been killed and perhaps 40,000 of them have been so badly injured, that they now function missing legs or arms or are so impaired, they'll now need a lifetime of care. And for what?

Many of you say "I support the troops," but how do you support them? By leaving them in harm's way? Do you greet them when they return? Do you take an interest in what happens to them or their families?

And what about the U.S.'s nearly 8 year old war in Afghanistan, which has now spread to and endangers Pakistan. Is that something you can't be bothered with even as that war is being escalated by the U.S.? What has that war accomplished? What do you think it will?

In the name of God, where is your conscience? How can you look the other way while all of this death and destruction goes on? How can you be too busy when it's done in your name?

You may say, "There's nothing I can do about it," but have you tried? When was the last time you took any action to stop this carnage? You will never know how much you could accomplish or how important your voice is until you find the courage and the conscience to act!

[Don Caballero]

5. I trust Bernanke to do the right thing

[L0oniX]

6. BWAHAHAHAHAHA

[TexasObserver]

9. Recommend. I agree that interest rates will increase.

As interest rates increase, which they seem sure to do, the bond market will take a hit, as will government securities. As Krugman has implicitly suggested, we're going to need another Stimulus package of $700 billion or so by the end of summer, or the recovery could flame out. That will further devalue the dollar and likely increase interest rates.

I remain cautiously optimistic for job recovery this year, but don't see unemployment dropping below 8% this year.

I do not associate myself with the specific advice the column gives, however. What is wise for one investor is unwise for another. One size does not fit all.

[No DUplicitous DUpe]

10. Re: .."but don't see unemployment dropping below 8% this year."

Boy, I think you are one optimistic person. I think the mid-low 9%'s will be considered "making progress"

[TexasObserver]

11. I believe it will drop below 9%, although not by much.

8% seemed a safe floor, and that's why I used it.