Thursday, June 11, 2009

Interest Rates Are a-Risen

Yep, that'll happen when a government borrows excessively.

Yesterday my post was on T-Bond rates. Today's post links to a story that says mortgage rates are going up. Ultimately, government borrowing and spending crowds out private investment by raising interest rates and taking in money from lenders that otherwise may have gone into rebuilding the private sector of the economy. They are lending money to the government rather than to private entities via banks and other outlets that lend capital to wannabe "bidness" investors.

I learned that early on in my economics education. Seems the textbooks were right. Can somebody lend President Obama N. Gregory Mankiw's macroeconomics undergraduate textbook?

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