Inflations affect on the fiscal budget and the home market affecting financial market
https://www.cnn.com/2022/06/22/inves...ing/index.html
A CNN article saying that the homemarket is being affected by higher interest rates and it’s potential effect on the stock market. I think the article misses the point that this is unlike 2007 2008 in that a lot of financial institutions are not just in the home loan arena, they were actually buying physical asset homes. If those assets start to stall out or drop in value the financial institutions are going to have to dump them, and when they start to dump them more of the financial institutions will do the same, and you could end up with a slaughter sale.
The other thing that I have not seen any real discussion on is as the inflation rate and the interest rates go up that the servicing of our national debt is going to get a lot more expensive. Now maybe it doesn’t have an immediate effect right now because the 10 and 30 year treasury’s coming up for having to be refinanced are at higher or maybe just near current interest rates. Maybe not so much for the 10 years, God does time pass by fast. But as those artificial super low interest rates post-great financial crisis start to come up for refinancing at multiples of the original interest rate, that is going to put a burden on the fiscal budget, and will have to see either cuts in spending, increase taxes, or blowing out of the debt further at these higher interest rates.
Party is over, dudes
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