Monday, July 29, 2013

A Constant Fear of Rising Interest Rates

Click to enlarge.

That's 5+ years of fear so far.

I can't speak for others, but as a saver I tend to fear the opposite even more. What if ZIRP sticks around a lot longer than most expect? You know, like it has been doing.

Source Data:
St. Louis Fed: Custom Chart


Anonymous said...

This is going on much longer than I thought possible. I guess I'll give in and get some I savings bonds. I also couldn't imagine the stock market staying levitated as long as it has. I guess the money has to be parked somewhere. Ag land is in a bubble, too, and housing is showing some life again.

Thanks again for all these charts which really help us understand what's happening (or not happening as the case may be).


Stagflationary Mark said...


You might want to wait until November 1st to buy the I-Bonds. It's only 3 months away.

It's now within the remote realm of possibility that the fixed rate could be higher than 0%, if interest rates were to rise more that is.

Not much harm in waiting at this point. I chose to lock in back in January for what it is worth. I thought the chance of a rate better than 0.0% was roughly nil this year. The odds have improved slightly though, perhaps even tripled. Of course, 3x roughly nil isn't saying all that much. Sigh.

Stagflationary Mark said...

Rick Santelli just put up a short-term chart of the 5-year to 10-year spread. Said it was the widest in 2 years.

I might be biased but I've always liked him. ;)