Misery Index High

[Brittain33]

I'm less worried about the rates at which people get new mortgages in the future... they can decide for themselves what they can afford. There is a systematic benefit to reducing the number of mortgage-owners today, and most people have fixed mortgages, who are underwater because it leads to more sales, more freedom of movement, and a healthier economy. The surest way to do that is to raise the general level or prices in the economy to catch up a bit with the rampant housing price inflation that preceded our current crisis, so housing prices, and consequently housing debt, can diminish by comparison.

Don't confuse interest rates with inflation.  They just dropped again.

I was responding to The Vorlon's post about higher interest rates in the future.

[Brittain33]

That sure puts the screws on retirees, though. And a bunch of them already got bent over by the market turmoil.

Many of them are invested in bonds which are paying absurdly low interest rates that don't support them. Social Security is indexed to inflation. I think what we have now for economic policy is overwhelmingly tilted toward seniors. Seniors benefit from economic growth.

[J. J.]

That sure puts the screws on retirees, though. And a bunch of them already got bent over by the market turmoil.

Many of them are invested in bonds which are paying absurdly low interest rates that don't support them. Social Security is indexed to inflation. I think what we have now for economic policy is overwhelmingly tilted toward seniors. Seniors benefit from economic growth.

With a long delay.  Also, many pensions are not.