Government Deficits Affect Everyone

Date 2007/6/15 14:42:36 | Topic: The Nimrods Never Cease to Amaze Me

According to the New York Times, yields on the 10 year Treasury Note are up almost 100 basis points in the past year. Thus mortgage rates are on the rise.
While the Federal Reserve Board sets the nation’s interest rate policy, buyers and sellers in the Treasury market drive the rates that affect both consumer and corporate borrowers. Bond yields rise when prices fall. The 10-year Treasury note stood at 5.22 percent at the end of trading yesterday, up from 4.7 percent a month ago.

What this means is that the "borrow and blow" fiscal recklessness of the Bush Administration and their war-time tax cuts has the government scrambling to sell notes to cover our national debt and deficit. This means that mortgage lenders will have to raise rates to compete with the federal government on the open market.

If you have an adjustable rate mortgage - you're pretty much screwed. Student loans? Screwed. Credit cards? Screwed.

Next time you hear your Congressman talking about cutting taxes, compare your tax cut with the amount extra you'll be paying on your mortgage, student loans, and consumer debt. It's time for our government to get with the program and adopt some fiscal progressivism.

Keywords: Debt, Economy, Corporatism

This article comes from The Lewisville Texan Journal

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