Interest Rates Seem Stuck!

Many of us, myself included, believed that interest rates would rise as 2010 wore on.  Apparently, that is not currently the case and there is nothing in the immediate future that points to their imminent rise.  To quote The New York Times today, “Quite to the contrary.”  The crux of the article is that the financial markets are more worried about an extended recession rather than government debt, as evidenced by the continued investment in US Treasuries.  Deficit hawks are having their way with shaping current economic policy , but another school of thought has emerged that defends  slowing “the push for spending reductions in major economies.”  For the full article, follow the link above.

While uncertainties remain in the long-term economic and interest rate forecasts, for the interim, this much we know.  Interest rates are as low as they have been in 60 years!  Although squeaky clean credit and maximum documentation of income is required, borrowing money is cheap.  Housing inventory remains plentiful and the combination of that with cheap money should drive real estate purchases and investments.

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