As Federal Reserve Meets, Americans Should Get Prepare Higher Interest Rates On Credit Cards, Loans, Larger Monthly Payments On Home Purchases And CUT SPENDING!! We Can See The Bubble To End All Bubbles
Investmentwatchblog.com
June 18th, 2013
ALERT: Peter Morici: As Federal Reserve meets, Americans should consider cutting spending
Wednesday, the Federal Reserve is expected to indicate how quickly it will push up interest rates.
Ordinary Americans can expect monthly payments on home purchases to rise, selling houses they already own to get tougher, and interest rates to jump on credit cards and other consumer loans.
Recent retail sales reports indicate the average family is spending freely and not saving very much.This may be a good time to trim back—families may need to borrow in an emergency and higher interest rates will take a bite out of the family budget.
This is a good time to rethink the family budget. If you have credit card debt, pay it down as quickly as you can.
The Fed has been purchasing $85 billion in mortgage-backed securities and longer term Treasury Bonds—economists call this “Quantitative Easing.”
These purchases have fueled, until recently, rock bottom mortgage rates and a much heralded surge in housing prices. The latter could well prove unsustainable, because Wall Street speculators have been doing a lot of the home buying, even as the demand for home ownership is the United States is actually waning.
More Americans are choosing to rent that’s because many young families, saddled with huge student debt and earning less than their parents, can’t consider purchasing a piece of suburb heaven.
The Zillow Survey of 105 economic forecasters, in which I participate, has the surge in housing prices slowing significantly in 2014 and 2015. This deceleration could turn into a housing market collapse if the Fed pulls back on easy money too quickly, and many more homeowners could owe more than their homes are worth.
Car sales and prices have been booming, as Ford, GM and others have offered customers with good credit scores quite reasonable rates on new car loans. Their financial affiliates will face much higher costs for funds, and automakers will have to pass along higher interest rates to customers and trim incentives.
If you genuinely need a new car, this may be the best time to get that good deal. Higher borrowing rates will hit the used car market hard, lowering your trade-in value—along with higher interest rates, that will push up the monthly payment on new vehicles.
The Rest…HERE
