AdvancingTime
Senior Member
- Feb 8, 2015
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In a recent article written by bond king Bill Gross titled "Going To the Dogs" Gross describes some of the current economic conditions we face. His thoughts strongly dovetail with my concerns as to how these low rates distort and cause massive misallocation of resources throughout the economy.
The growth in sub-prime auto loans is a glaring confirmation of this and the main reason for surging sales in the auto sector. This effort to offset the dwindling buying power of the public sector by encouraging them to take on more debt by easing terms and artificially low interest rates will not end well. Below is an article that looks deeper into the flaws in this policy.
http://brucewilds.blogspot.com/2015/03/low-interest-rates-and-unintended.html
The growth in sub-prime auto loans is a glaring confirmation of this and the main reason for surging sales in the auto sector. This effort to offset the dwindling buying power of the public sector by encouraging them to take on more debt by easing terms and artificially low interest rates will not end well. Below is an article that looks deeper into the flaws in this policy.
http://brucewilds.blogspot.com/2015/03/low-interest-rates-and-unintended.html