Low Interest Rates-Best For The Majority?

Their are a number of commentators calling for an increase in interest rates.

The argument goes that those with investments but little or no income from employment need higher interest rates to fund their living expenses.

Whilst it is true that some are in a poor financial position because of low interest rates, the majority of those living in the UK are well-suited to a low interest environment.

Homeowners are one obvious example of a group favoured by low interest rates but there are many others. In fact, anyone with a little capital who is prepared to invest in equities is a "winner".Low interest rates draw more individuals and fund managers into investing in equities, increasing prices.

We cannot afford people making low risk investments earning good returns.At the moment,1% or less is about right.

If investors want to make a better return,they need to take greater risks.It is as clear and simple as that.

 

Wednesday, 20th November 2013

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