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It is a gamble. The interests can go up and then you could be cooked. And anyway you need to find a way to get ahead of the inflation with this money. Sure it i
by kukx 5y ago
It is a gamble. The interests can go up and then you could be cooked. And anyway you need to find a way to get ahead of the inflation with this money. Sure it is an opportunity but not without risks.
- klodolph 5y agoThat’s backwards. The lender hopes interest rates don’t go higher (they could have invested in shorter-term investments and reinvested at higher rates), and the borrower hopes that interest rates do go higher (they have to pay less in real dollars, even though it’s the same in nominal dollars).
- xyzzyz 5y agoIf you are borrowing mostly short term with intention to roll over (like US Gov does, for example), then yes, interest rate hike would fuck you over. A safer way of doing that is to get a large, long term, fixed rate loan, and use it to buy some real asset. You know, like, say, a house. With a long term fixed rate mortgage. Has that become more popular than usual recently?