Interest Rates

[malleefarmer]

Official lending rates here in Australia are around 4.1% plus banks margin.

5 and 10 yr rates are on the increase slightly,most banks recommending farmer clients lock in for 5 years using bills rolling them over every 1/4 with top side locked in.

Every economy is different and Australia it seems has highest interest rates in the world. If our rates do in fact rise further and rest of world doesn't a inflow of foreign money will cause havoc with our fx market meaning push our dollar higher. lowering farmers terms of trade.

What are financial institutions recommending in Canada the land of milk and honey were you have super stable good governance stuff all govt debt and things are well run and farmers respected.

[SASKFARMER3]

When you sleep next to a elephant that has some problems its hard to say what will happen. If interest rates go up they cant keep up the game.
Also the East part of Canada has some problems also. Real-estate is another I feel.
Time will tell.

[BreadWinner]

High interest rates would bankrupt half the people in canada overnight. Interest rates won't go up due to most Canadians holding large dept and mortgages.

[groundspeed]

Financial institutions are predicting a slight increases in rates for 2015 but nothing major.

[errolanderson]

There is no way rates can go up anytime soon.

The risk to the stock market bubble would be huge. Personally expect rates to drop further in 2015 . . Europe is taking the lead on this one.

A 1/4% hike is about all it would take (IMO).

[errolanderson]

(IMO) Central bankers on now treading on dangerous territory.

They no longer have any strings to pull to manipulate markets significantly. They have the 'interest rate' string and they have the 'money printing' string and both of these have already been pulled . . . with 'kicking-the-can-down-the-road' results'

If rates are hiked (Bank of England Carney hinting) and the results are not favorable, what now? That's the risk for central banker decision making ahead. Global economies must swim on-its-own . . . and that test (IMO) lies ahead.

[sk_wheatking]

Hey breadwinner your right on the money. If interest rates were to go up even 1% it wouldn't take more than 6 months for more than half of Canada to go broke. To many people leveraged to the max at these rates.they sell boats, cars,houses,you name it based on monthly payments now. If you can fog a mirror you can get financing.

[cottonpicken]

250 trillionish total global credit market debt

70 trillion global gdp

Continous roll over of the sovereign bonds

Interest rates go up?

1.4 quadrillion of dervitives go up in smoke

Game Over

[errolanderson]

http://www.bloomberg.com/news/2014-07-30/greenspan-says-stocks-to-see-significant-correction-.html

Cotton . . . Alan Greenspan concurs

[cottonpicken]

Sad/scary part is this points to war.

[sumdumguy]

mallee, can Canadians invest their money in Australian banks?

[cottonpicken]

Hope i dont bore people or waste my time with facts and figures.

One thing that sucks to think about is that 70% of the us's national debt is accumulated interest,didnt build a school or a road,ASSume the same for here.

[malleefarmer]

wonder why australias treasury has a different opinion than most in the world

[fjlip]

How could any country afford a war? We are all broke. Arms stocks are crazy all over the planet, no more required. The young who have always been cannon fodder, would refuse to fight. Economies all so connected and dependent would crash in a war. More money lost from trade than could ever be gained.

[errolanderson]

the only way out of this is a drop in everyone's standard of living which no politician or central banker will ever talk about.

agree war would just make matters worse.

to me, there is a distinct risk of a deflationary recession/depression ahead

easy money is what is turning the wheels of the american economy right now, not real growth.