{"id":14181,"date":"2013-05-24T07:53:27","date_gmt":"2013-05-24T14:53:27","guid":{"rendered":"http:\/\/www.itmtrading.com\/?p=14181"},"modified":"2013-05-24T07:53:27","modified_gmt":"2013-05-24T14:53:27","slug":"rising-interest-rates","status":"publish","type":"post","link":"https:\/\/www.itmtrading.com\/blog\/rising-interest-rates\/","title":{"rendered":"Rising Interest Rates"},"content":{"rendered":"<p>Many market commentators have painted themselves into the fool\u00e2\u20ac\u2122s corner by trying to anticipate just when <strong>Interest Rates<\/strong> would rise. As Robert Kuttner, author of the new \u00e2\u20ac\u0153Debtors\u00e2\u20ac\u2122 Prison: The Politics of Austerity Versus Prosperity\u00e2\u20ac\u009d once penned in BusinessWeek, \u00e2\u20ac\u0153What do you call an economist with a prediction? Wrong.\u00e2\u20ac\u009d Unfortunately, at some point they will be right. <\/p>\n<p>However, according to UBS economist Maury Harris in USA Today, America is close to \u00e2\u20ac\u0153unleash a spending spree. Years of self-denial give way to pent-up demand.\u00e2\u20ac\u009d His canary in the mine shaft is what he sees in consumer sentiment: \u00e2\u20ac\u0153Harris estimates that in the next five years, catch-up consumption will boost annual consumer spending growth by a half point to above 3% from about 2%.\u00e2\u20ac\u009d Really?  Are we in the summer of actual recovery? Am I feeling some \u00e2\u20ac\u0153green shoots\u00e2\u20ac\u009d beginning to grow?<\/p>\n<p>Harris maybe spitting against the wind on this one. As Jeremy Grantham, chief strategist of the $100 billion GMO money managers, remarked to InvestmentNews, which for 90,000 professional investment advisers, is the  newspaper of record, \u00e2\u20ac\u01533% annual GDP growth is history.\u00e2\u20ac\u009d<\/p>\n<p>The result is a long stretch of Japan-style deflation, and is something that very few people are looking forward to. While rising rates are certainly a nightmare for borrowers, there are ways to prepare for what is to come. Did someone say \u00e2\u20ac\u0153<a href=\"http:\/\/www.itmtrading.com\/\">Own gold<\/a>?\u00e2\u20ac\u009d<\/p>\n<p>In his recent newsletter, Pimco\u00e2\u20ac\u2122s Bill Gross advised: \u00e2\u20ac\u0153You\u00e2\u20ac\u2122re going to lose money investing &#8230; because the central banks say so.\u00e2\u20ac\u009d This rally is Fed-powered and it\u00e2\u20ac\u2122s their game. Soon the Fed will be forced to stop printing cheap money because when interest rates go up it will cease being cheap money and will become expensive money.<\/p>\n<p>The big players who have benefitted from the mountains of cheap money say the crash \u00e2\u20ac\u0153won\u00e2\u20ac\u2122t happen soon.\u00e2\u20ac\u009d There may be reason not to believe them. They\u00e2\u20ac\u2122re playing the game with trillions of dollars, and they are beginning to prepare for \u00e2\u20ac\u0153when rates take their first turn higher,\u00e2\u20ac\u009d and when that happens interest rates will soar \u00e2\u20ac\u0153swift and steep.\u00e2\u20ac\u009d At that point it will be too late to prepare for higher interest rates.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Many market commentators have painted themselves into the fool\u00e2\u20ac\u2122s corner by trying to anticipate just when Interest Rates would rise. As [&hellip;]<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1207],"tags":[27,59,84],"class_list":["post-14181","post","type-post","status-publish","format-standard","hentry","category-blog","tag-american-economy","tag-gold-2","tag-interest-rates"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.itmtrading.com\/blog\/wp-json\/wp\/v2\/posts\/14181","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.itmtrading.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.itmtrading.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.itmtrading.com\/blog\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.itmtrading.com\/blog\/wp-json\/wp\/v2\/comments?post=14181"}],"version-history":[{"count":1,"href":"https:\/\/www.itmtrading.com\/blog\/wp-json\/wp\/v2\/posts\/14181\/revisions"}],"predecessor-version":[{"id":14182,"href":"https:\/\/www.itmtrading.com\/blog\/wp-json\/wp\/v2\/posts\/14181\/revisions\/14182"}],"wp:attachment":[{"href":"https:\/\/www.itmtrading.com\/blog\/wp-json\/wp\/v2\/media?parent=14181"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.itmtrading.com\/blog\/wp-json\/wp\/v2\/categories?post=14181"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.itmtrading.com\/blog\/wp-json\/wp\/v2\/tags?post=14181"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}