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FED to Hike Rates to 7% by mid-2011....
2009 Aug 11, 12:32pm 13,575 views 54 comments
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Jeremy
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2009 Aug 11, 2:22pm
No chance, period.
Interest rates will be continually manipulated and maintained at an extremely low level. At least through the entire Obama Administration. After that, who knows. But there is 0% chance of hyperinflation (or any inflation for that matter), and 0% chance of the fed raising interest rates any time in the next 3 years. In fact as there is no limit to Obama's manipulative debt enslavement forced on all Americans, new and greater incentives will be given to buy stuff, use credit and give up our freedoms, look for more government incentives to buy cars, buy houses, use credit cards, get loans, etc.... 8,000 for first time homebuyers?? Instead of expiring, my guess is something like 10 - 15k "tax incentive" for buying a house, whether you're a first time home buyer or not.
Jeremy
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2009 Aug 11, 2:25pm
I would look for that "tax incentive" sometime in November. If nothing else, it's a sure thing that the first time home buyer tax credit will be extended indefinitely. Also, depending on the remaining response to cash for clunkers, I would expect that to be extended as well.
zzyzzx
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2009 Sep 2, 5:19am
I would love to see 7% interest rates, but it's not going to happen by then. Maybe if the Chinese dump all their USD reserves, or something.
Interest rate will be raised when housing will start to recover. and it will be done in a way which makes sure that housing does not go lower due to inerest rate hike.
P2D2
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2009 Sep 2, 7:35am
homeowner_for ever_san jose says
Interest rate will be raised when housing will start to recover. and it will be done in a way which makes sure that housing does not go lower due to inerest rate hike.
What were the interest rates in past two years? Did it stop housing from sliding down? But yes, rapid hike in interest rate will make thing worse and Fed is unlikely is going to do that.
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http://www.cnbc.com/id/32372518
We think we'll be at 5 percent by the end of 2010 and continuing higher into 2011,” she said. “The Fed is going to be very cautious to make sure the economy is on solid footing before they hike.”
In the meantime, Lekas said the Fed would have already begun to raise interest rates if it weren't for Bernanke's tenuous position re being reappointed.
“We do think they'll signal that they'd like to raise and probably begin so toward the end of this year,” said Lekas.
“We think the Fed will take [interest rates] to almost 7 percent by the second quarter of 2011. That's based on weak GDP and continuing deterioration of the dollar, which is inflationary.”
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I've heard lots of housing bottom predictions for 2011-2012… Anyone with a brain that needs to sell their house in 5 years or less… NEEDs to sell NOW and sell at a reasonable price… OTHERWISE they'll be taking a much bigger loss in a few years when interest rates rise.
If the FED hints at this interest rate rise... and the news gets out… Prices should start falling hard this Fall....
#housing