Quote:
Originally Posted by menotakoala
Greenspan didn't raise rates. Also, these cuts will cause more people to borrow more money and in return, we will be seeing more people defaulting on their mortgages and see more foreclosures. So we will be seeing the economy go even lower. Frankly speaking, I don't know what some of the brokers and realtors are smoking, but we are in a recession.
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But at the same time it will mean that all those people that are close to defaulting to due higher refinance rates, on things like mortgages, might not. Also, with a flood of cheaper houses, because of that situation happening over the last year, and the lower rate, means it's more affordable for people to get started out.
Granted some people may take the opportunity to max themselves even more, but those people obviously haven't learned the lesson yet:wink:
And how you think that higher interest rates will help stimulate an economy out of a recession?...The higher rates go, the less people want to spend. The less people spend, the more it hurts the economy...The lower rates are, the more they spend, the more the economy gains...
