Interest Rates Are So Low They Are Hurting People

Money market interest rates are very low right now just like they are for CD’s and savings account interest rates. Anyone trying to find a decent interest income for their portfolio will be extremely disappointed as it is next to impossible to make money from interest without taking some risks. If you want to profit from your money to any meaningful extent, you are probably going to have to buy stocks or bonds and take on that risk. Investing in government backed CD’s or Treasury bills is just not going to pay you enough to make it worth your while.

High yield does not imply what it used to as today, something that is categorized as “high yield” is what they used to call “low yield”. No one is making much interest income at this time by way of their “secure” investments that are guaranteed by FDIC insurance. It’s a time to wait things out and also you just have to tighten your belt until things get better. There will probably be better economic times ahead and we simply have to get by this to get to them.

No one seems to talk much about how low rates of interest hurt retirees and older folks the most. People who are retired and living off fixed incomes ought to have much of their money in things that are safe and guaranteed by the government FDIC insurance. Right now though, anything like that is earning very little which can have an adverse effect on all older people.

Since so many seniors depend on interest income as a significant part of their earnings, rates being so low means that they are in big trouble. We will all become senior’s someday in the future and it’s one thing we should all be concerned about. More attention should be paid to the plight of the older people in our country as they are suffering through this economic downturn just like younger people are.

When you think about it, low interest rates are really just one other form of redistribution. Low rates don’t harm people who have little cash and in reality it helps those who want to borrow because they’ve nothing. Those that do have cash and want to make money from interest now make very little. Democrats all the time speak about income redistribution and helping the little man and these low interest rates are just one way they are accomplishing that with little publicity.

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