A financial advisor I work with is putting all of his older fixed income clients in to the stock market.
Treasuries and CD's paying nothing because the Fed has set interest rates at 0%.
So those that saved their whole life, are now the minority.......the Fed would rather support the majority of Americans that are deep in debt........
I wonder wha the next Fed induced bubble could possibly be?????
"the Fed would rather support the majority of Americans that are deep in debt........"
Let’s say you are the CFO of a company. Someone comes to you with a potential investment in production and the project has a 6% ROI. Do you invest in the project? Will that depends, if your cost of funds in 8% then the answer is no. The cost of funds is the rate at which you can borrow, so you by keeping the interest rates low you are encouraging investments by private firms. If on the other hand your cost of funds is 4% then you should invest. Thus low interest rates encourage investments which should stimulate the economy.
The Fed is leading the Retirees over fiscal cliff.....I would still keep my money in fixed income mutaul funds until there is a market correction of at least 30-40 percent......it is going to happen once enough monies have been moved from fixed income into stock/bonds.
"The Fed is leading the Retirees over fiscal cliff"
More empty-headed nonsense, without any FACTS in support.
And what does this poster think "fixed income mutaul [sic] funds" are invested in other than stocks and bonds - jellybean futures?
Typical right wing garbage from the brainwashed. The TRUTH is that the overwhelming majority of people who live off their savings are millionaires. And those savings are stocks and bonds NOT CDs or savings accounts.
The REAL “grandma” lives off of Social Security, pensions and family assistance and NOT savings account interest which historically, has ALWAYS been insufficient to beat inflation.
But to rembrandt.john and his ilk, the chance to spew absurd propaganda is so much more personally satisfying than repeating truth and economic reality. (And they wonder why they went up in flames this past November with their voodoo economic theories.)
There are absolutely NO factual indicators that Americans are in any way being harmed by low interest rates on personal savings. So johnny’s weepy tale of woe about “those that saved their whole life” is as bogus as all the rest of his brainwashed drivel.
Seriously, there are many middle class retirees who were living on the margin based off savings and CD interest and now cannot do so....wake up! Obama and The Fed are forcingthem into stocks/bonds to realize any returns, The stock market will correct in a harsh way...and those retirees will get hurt badly!
Ven, I believe you're wrong about low interest hurting? I'm 70%cash, 30% stocks. Why? This market is as phony as a bible thumping puke!!!!!!!!!!!!!!!!!!!!!!!!!!!!! In my opinion, not even DD is enough these days, since big money is driving everything. Now am I wrong? Well, I haven't changed my spending style in 25yrs. I'll survive anything but a 30's style crash!