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Originally Posted by petegz28
My argument is if you make the cost of living cheaper then people will have and spend more money thus offsetting any impacts to borrowing.
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But paying your monthly mortgage and car payment is your cost of living. And especially businesses who are thinking about making purchases. A farmer who wants a new combine cares about interest rates and depreciation rates. A clothing store that wants to expand into the adjacent room cares about interest rates.
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We have had rates low for years and what have we seen? Increased joblessness. Increased failed businesses and a housing market that is in no better shape than it was 4-5 years ago. We have seen gas prices soar, energy prices soar and food prices soar.
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We actually haven't seen increased joblessness and failed businesses. We haven't even seen soaring food prices.