|
waterloo iowa | With zero interest rates we may have hit a wall where we are stuck handling a lot of money without actually creating wealth.If your house is worth twice as much because cheap interest lets people make higher payments it only benefits the seller.But after the seller pays taxes what does he do with the rest of the money that is both safe and a decent return.
Back when there was a hog cycle you knew that the lower prices were one year the better they would be next year,,the bad times might have been severe but didn't last forever.With land at 8-9000 an acre we might see people with large borrowing ability willing to break even for a long time rather than to get out when losing money .
I knew a guy that had 300 acres paid for in early 80s that went under because he used it for collateral on operating loans on the 1,000 acres he rented when he went under a couple other guys got a start,now that land would be worth 2.5-3 million and he would last longer,because of less pressure on interest costs
| |
|
Do we need a depression
