hyperinflation: Interest Rates are on the rise!
- 05/29/09 07:23 AM
All signs point to rising interest rates. The inflationary fears have started to materialize and have affected the Bond markets. Over the next few years, Trillions of dollars will be pumped into the economy, and many fear that this will cause hyperinflation. Because interest rates are determined by the price and yield of Mortgage Backed Securities, when consumer confidence comes back, there will be a flight away from fixed income instruments, and towards equities or stocks. In other words, money will stop flowing towards bonds, and will start moving towards other items that will more likely beat inflation. While bonds offer … (4 comments)
All signs point to rising interest rates. The inflationary fears have started to materialize and have affected the Bond markets. Over the next few years, Trillions of dollars will be pumped into the economy, and many fear that this will cause hyperinflation.
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