Global recession, inflation, interest rates, real estate.? - real estate interest rates
Well, there are contradictory and confusing answers, there are interest rates and recession.
What happens to interest rates and house prices in a global recession in an economy with rising inflation?
Tuesday, January 12, 2010
Real Estate Interest Rates Global Recession, Inflation, Interest Rates, Real Estate.?
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Interest rates are often in a recession:
"The income of people fall into a recession, which reduces the amount of the records.
"The demand for credit by businesses in general, falls into a recession, because it spends less on new buildings, equipment and inventory. In addition, the Federal Reserve takes steps that are to boost the rate of interest during the economic recession.
"The Federal Government has approved the application for credit generally increases in times of recession, the economy and reduce the decline in consumer income taxes, and programs such as unemployment insurance, ask for an increase in expenditure."
But with inflation, raising rates because they are generally parallel to the inflation rate. Therefore, there is a mixed effect, and follow the interest rates to one of the two movements are stronger. Recession and inflation are neutralized each other to some degree, but if you are stronger than the other, then this effect is dominant.
Interest rates rise, because in a global recession and fewer people to play with the investment, they tend to stay liquid (accessible) money, so they did not all your money in companies as investment banks. Moreover, because the people have no money, no savings either. Thus, with the financing of small loans to banks on loans, who is selective. One possibility is to raise interest rates. This means that only those with a high probability of return on investment to receive a loan.
Decline in housing prices, because they are excluding a large number of mortgage loans. People have trouble paying the mortgage, so that their collateral (house) in danger, are expulsion. Instead of losing the guarantee for the bank to decide to sell. With a market flooded with supply (real estate) for sale and could afford only very few people during) a recession (low demand from the buy price is downward trend.
there will be no more prices
In the globalized economy is a combination of variables, and when we talk about global economy has some dark spots .... Whatever certain situations call, the call for global recession, interest rates ....
Too low interest rates in the world could mean they do not really get a negative (a return on their investment, which in turn will) pay for it, it is unacceptable in the economy and can lead to massive disinvestment in the world .. .
Interest rates too high, can cause a crisis, because of the high risk ...
In the global economy on the relationship between savings rates and rates, control of exchange rates, we can see if the global economy in crisis ....
There may be a crisis in interest rates, but its effect will be offset by other variables and do not find to fluctuations in exchange rates ....
I hope this can answer some puzzling ...
In the globalized economy is a combination of variables, and when we talk about global economy has some dark spots .... Whatever certain situations call, the call for global recession, interest rates ....
Too low interest rates in the world could mean they do not really get a negative (a return on their investment, which in turn will) pay for it, it is unacceptable in the economy and can lead to massive disinvestment in the world .. .
Interest rates too high, can cause a crisis, because of the high risk ...
In the global economy on the relationship between savings rates and rates, control of exchange rates, we can see if the global economy in crisis ....
There may be a crisis in interest rates, but its effect will be offset by other variables and do not find to fluctuations in exchange rates ....
I hope this can answer some puzzling ...
In the globalized economy is a combination of variables, and when we talk about global economy has some dark spots .... Whatever certain situations call, the call for global recession, interest rates ....
Too low interest rates in the world could mean they do not really get a negative (a return on their investment, which in turn will) pay for it, it is unacceptable in the economy and can lead to massive disinvestment in the world .. .
Interest rates too high, can cause a crisis, because of the high risk ...
In the global economy on the relationship between savings rates and rates, control of exchange rates, we can see if the global economy in crisis ....
There may be a crisis in interest rates, but its effect will be offset by other variables and do not find to fluctuations in exchange rates ....
I hope this can answer some puzzling ...
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