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Sensible Solutions

Guest working things out. Winning Afghanistan. The Democratic pie-eating contest. The answers, my friend. Plus much more.

(Page 18 of 18)

/p>

Now let me see if I have this straight: Interest rates have been historically low lately because of a worldwide high savings rates, and therefore competition for savings among savings institutions is low. But now people everywhere have figured out they can get a higher rate of return by moving their savings into equities.

Then does it not follow that as people pull money out of savings institutions, interest rates will start to increase as those institutions try to lure them back? And don’t equities markets react to higher interest rates the way a cat reacts to a bath?

p>Are we getting a taste of this in the stock market this week? br> — Paul Doolittle /p>
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