Monday 20 October 2003

Borrowing to Cost more

Snow Rate Remarks Not Policy-White House

Snow says that intrest rates are going up and that will be the sign of a growing strong economy.. this is true for the most part. The thing is we are running a trillion dollar deficit. Government is borrowing all the money we need to grow the economy. Even with a growing economy, revenue is down thanks to lower capital gains and personal income tax.

The real reason intest rates are going up is because the US government is borrowing. Leading economic indicators were down last month.

This economy is still soft, while there may be hope in some sectors others are flat or declining. Rising intrest rates will affect the real estate boom which has been a high point for the sluggish economy. Jobless rates are reflecting the seasonal hiring done for the Christmas retail season, that is why they are at an 8 month low (duh).

So America look at your credit card debt and think about those nice adjustable rates you have been getting. Where you were paying 9% you will be looking at 19% or more. If you haven't already, get rid of that debt as fast as you can. Every dollar paid today is 3 dollars less than you will pay in the future.

Posted by Philip at Monday 20 October 2003 | TrackBack