Paul Ryan: best way to encourage borrowing is by raising interest rates

ah, and interview by a Journolista, linked to by another Journlista, and posted by a Socialista.

it's the circle of life.

 

sure: "This transcript is edited for length and clarity."

given the source, and the obvious editing, this article, and the resulting commentary, have no credibility.

 

Your don't get it - if someone from the RIGHT makes a claim, to basso he thinks it means they are RIGHT!

 

is you disassociate the product from the delivery mechanism it no longer carries the same level of interest.

 

ChappelleDiddy disagrees.

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The only thing I can think of is maybe the rate is so low that some banks are not lending to other banks (that's what that rate is for right?) and just buying T-bills instead.

I suppose buying a T-bill is just lending $$ to another "bank" though.

 

roffles... basso really doesn't know the difference.

 

I didnt read the whole article, but the argument seems similar to one I was listening to last week.

Though I don't agree with him, I think you may be missing his point. I think his point is that having the UST long bonds at lows and the price of borrowing being so low is what keeps everyone from spending. Shaky confidence. If I look at those numbers every morning as an indicator of "is the economy improving? should I buy that house now?" then the lower they are, the less likely that people will spend. Basically what he's saying is: you'd rather buy something when you feel like its value is on the upswing, therefore we should create the artificial image of an improving/recovering economy to get people to relax and start spending.

Again, I don't agree with it as it seems quirky and impractical at best, but surely Mr Ryan understands that increasing the cost of something makes it less desirable given a normal environment.

 

Still a horrible rationale. Pretending confidence is better through a rate increase (when the Fed is now seen as THE last resort to prop up this years economy) is a thin illusion that won't even be felt by most of main street.

That "must buy now before rates change" rush is a very very short term boost. Most people wouldn't know, nor would they likely have the liquidity to act upon it unless they were already planning to buy something big anyways. What happens after "the boost" is that they're ****ed.

Who'd benefit most would be banks. Businesses would their warchests wouldn't blink as much, and those who are hurting won't like the rate increases.

 

Weird, given that that this is the only type of stuff you post.

 

that should be everyone's response to every single basso post from here on out.

 

What kind of point is that? We're talking about interest rates itself, not products or commodities. You can't sell the interest per se, because it is already an obligation to pay (or debt). If, for example you got a loan for 5%, and the rate increases to 10% do you somehow benefit? You're paying 5% less for your loan, however its not like you can then turn around and sell your obligation to pay that 5% to other people because you already spent the money you got for it. Most likely, what will happen is people will read the paper, realize that loans cost twice what they one did and won't burrow money anymore. LIke you said, raise the cost of something=lower the demand for the product.

 

This is what we get for having mostly lawyers in office instead of people that have worked in business and industry.

How can people who have never run a business or industry understand what laws and governing does to it?

Sad.

 

like George Bush

since you conservatives love him so much, reagan, I think you should change your theory to we need to elect actors.