Potential banking impact and interest rates

Question

what kind of banking impact do you think could come of interest rates in the US?

Answer 1

With banks closing up and the comming of a bank crisis, expect interest rates to increase in order to discourage people from taking loans, which will will worsen the situation, and high interest rates will encourage more saving as well, which will pay off bad debt.

The idiot below me obviously doesn't understand the concept of saving and actually believes that a continuous borrowing money with low interest rate is a good thing. If this is the case, then why is there a morgage crisis, it was caused by too many people thinking like him and taking money, which they could obviously not pay back. A continuous amount of borrowing does not necessary mean easy and free money, it means debt, which you accumulate and have to pay back in the future. In some cases short term debt may be good, if it is actually an investment in which you will be able to accumulate more than without the investment, however, debt itself and debt for leisure items is rather a horriable thing as the more of it means the debtor is tied down to the creditor who has advantages over him or her, which can result in a loss of financial wealth or even imprisonment by failing to pay off heavy debt.  Saving encourages investment and also helpful in a time of crisis.  If you get laid off and become unemployed or in another emergency that requires a good amount of financial backing, savings can bail you out, but too many people expect big government and the welfare system to bail them out by their own irresponsiability. This idiot would also believe that printing more money would also be a good thing because more of it is out there, even though inflation means prices will rise for all goods because of the simple money supply model, which demonstrates that prices increase because their is too much currency available rather reducing its supply, which will increase its value.

The deficit from the U.S. government overspending has shown huge negative affects on Americans as they have higher prices like the price of gas and other goods have increased because of the large amount of debt, which give foreign countries leverage over U.S. Especially Germany who released more of American currency in the market, which caused rising costs in goods purchased with American currency.

Answer 2

I love it when interest rates are low it means I can borrow money for cheap. Saving money is overrated.

Answer 3

Your question doesn't make a whole lot of sense. Interest rates are used by banks to price deposit and loan products.