Interest Rates Essays


U.S. Interest Rates Rise and Fall Essay

Essay Prompt The History of the Interest Rate Research the history of the prime interest rate since 1980. Create a chart that shows the changing interest rate and depicts the economic and political conditions, factors, and reasons for the changing interest rate. Include a written summary of your findings. Your response should be 2-3 paragraphs (5-7 sentences). The History of the Interest Rate The prime interest rate peaked on 19 December 1980 at 21.50% from where it gradually declined 4% over the next four months before rising again to 20.50% by mid-1981. However, this marked the end of high interest Continue Reading...

How Democracy Leads to Tyranny

he has. The real decisions -- the big ones concerning trade, interest rates, going to war, etc. -- are made by individuals at a much higher level (the representatives) who typically represent interests of other entities (such as those who supported their campaign or who have allowed them to have their "career" in politics: a federal congressman is paid well above the middle class average, after all). Meanwhile, the middle class man is obliged to obey the laws, regulations, tax code, TSA orders at airports, and so on that the ruling establishment passes on his behalf. The little bit… Continue Reading...

Negative Interest Rates Analysis

used elsewhere. In return, banks compensate savers interest incomes. Meanwhile, the interest rates are quoted as APY (annual percentage of yield) and savings account earns 3% APY. However, negative interest rates reverse this arrangement where savers or depositors are obliged to pay banks for holding their money. Moreover, central banks penalize commercial banks for depositing their funds with them. For example, The ECB (European Central Bank), some smaller European banks, and Bank of Japan have introduced the negative interest rate policy where banks, as well as other financial institutions, will have to pay charges for allowing central banks to… Continue Reading...

Student Loans Essay

the majority of private or bank loans. For instance, the majority of loans from banks come with high interest rates and these loans do not contain the same provisions for deferment of payment that are provided by federal loans. By contrast, Federal Direct Loans can be deferred for repayment until borrowers are enrolled less than half time as undergraduates or graduate students.4 The U.S. Department of Education has a number of loan servicers that administer the student loans for the William D. Ford Federal Direct Loan (Direct Loan) Program as well as for loans that were completed originally pursuant… Continue Reading...

Financial Statement Analysis Of Verizon

borrowing will pay off with future revenue, especially when borrowing is done at low interest rates. However, Verizon is heavily leveraged at a point when interest rates are rising, so there is definitely some risk there for the company. But overall, Verizon is in good financial health, especially given that it still has strong operating cash flows. Current Financial Health Current Ratio 0.87 Debt/Equity Ratio 90.78% The current ratio is not unreasonable for Verizon, though ideally it would be a little bit higher, over 1.0. The bigger issue is the trendline here. The current ratio was quite healthy in… Continue Reading...

Apples Stock Movement 2017

stock even at these all-time high valuations, I assumed investors would continue to buy in. interest rates are still low and investors seeking a significant return really have no choice right now but to buy into the stocks that are driving the market—stocks like Apple. If the Fed actually decides to really start raising rates significantly, the market could pull back—so that is why I would be reluctant to hold onto these stocks for much longer. Continue Reading...

Macroeconomic Indicators

easing (QE) to quantitative tightening (QT) in recent years, and the end of unconventional monetary policy, interest rates are set to continue to rise as the central bank reduces its balance sheet. With bond yields already going up and volatility at all-time lows, questions remain about how the market will react to this normalization process. One thing is for certain, however: the recent rise of prices across several asset classes has coincided with the years of QE beginning in 2008. Home prices have soared, bond prices have soared, equity prices have soared, college tuition has soared, and even precious… Continue Reading...