Kirby Daley: Why interest rates in US cannot go to 15 or 20 percent? 2009.02.23

[KhanIndustries]

We deserve exactly what is coming to us. We just had to give a shot at running an empire thus ignoring everything our founding fathers warned us about. Soon we will learn first hand what has happened to every.. single.. bloated empire in history.

[jamezbond78]

What would happen if we did raise rates to 15-20%? Wouldn't that just exacerbate the debt because we'd have to pay higher interest on borrowing? It seems like the only reason we're at near 0 interest rates is because we've run out of options. We have huge debt, huge money supply, huge deficiits, no production industry in sight...how can we dig ourselves out of a hole that keeps getting deeper?

[thomasst2]

Well...your central bank working with the big banks can try to mask the effects of inflation to keep interest rates low:

Manipulate the price of gold (struggling to break $1000), manipulate the CPI, stop reporting M3, price controls on oil and other commodities (which the CFTC and the Fed affect since most of the world's commodities are priced in dollars), use $600 trillion in interest default swaps to manipulate long term interest rates down.....Won't get us out, but it buys us some time.

[strasheep]

big lesson for America!!

[guslingus]

China's GDP is a third of the USA... how much do you think they can do.

The USA has already screwed them......... The USA going down and nothing can fix it.

[gammabun]

you say chinas gdp is a third of the US but your logic is screwd because 75% of US GDP is consumption and china has the lowest GDP of consumption per capita

china is producing

us is buying

[dressupjesus]

@gammabun Damn straight.

[truthsabre7]

Hello hyper inflation.

That's change you can believe in.

[BlueSkies360]

I don't understand why US wants China to appreciate their currency? It is suicidal.

[Strettger]

This is because China will become uncompetative in production, and higher end production will move away from China to the USA in theory.

In practice, it would move to India or some even cheaper country.

[stealthpakfa]

@Strettger

bullshit, to gain access to the booming chinese market, u have to produce in china, otherwise its costs extra to export to china with transportation costs and tariffs, thus they have no choice to produce in china to be more competitive or else their rivals producing in china wins.

other cheaper countries dont have the infrastructure like china does nor do they have the chinese consumption power fueled with huge savings pool.

production will never move back to america.

[kahunabear]

Timing is everything, but it sure looks like a no brainer.