Economic Circle of Life

Published May 05, 2017

It is quite right to talk about interest rates going up. It is quite right to talk about them likely going up more. But it is wrong not to tell you why they're going up. And that's where I fault many in the media: They pounce on the bad and ignore the good.

If you're in debt, of course, rates going up... well, that's bad. Forgotten, equally of course, is if you're thrifty and save, rates going up... well, that's good.

The bigger point is this: Rates are going up because the economy's looking up. The economic numbers prove it. Strong corporate earnings confirm it.

The risk is that the better things get, the higher prices will get, hence that wacky Federal Reserve fixation to take away the punch bowl before we're all punch-drunk spenders.

Frankly, I think the Fed is overdoing it. But alas, rates keep going up.

So far though, it's important to point out that "most Americans" are still feeling up. They are still buying computers, still buying homes, still buying cars, still buying lots of stuff. Which is why rates keep going up.

It's the circle of economic life. The whole pie, if you will. I just thought you'd like to see that whole pie, rather than the negative slice you're typically getting fed.

Happy eating. Happy shopping.

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