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Look. This isn't 2008. Banks handed out < 4% mortgages for years. There is no way people are letting these loans go. The loan payments are cheaper than rent in
by ransom1538 4y ago
Look. This isn't 2008. Banks handed out < 4% mortgages for years. There is no way people are letting these loans go. The loan payments are cheaper than rent in many areas. The most valuable thing people own right now is super cheap money that is being inflated away. The group of people that own these loans will be the new upper-middle class.
- User23 4y agoI'm not a fan of debt. But I don't let that keep me from realizing that low interest debt is a solid hedge against inflation.
- ransom1538 4y ago"low interest debt is a solid hedge against inflation" ? It literally is just that. As inflation increases the value of a loan decreases. EG. The value of your money today is worth more than the value of your money tomorrow. So you pay your loan at a fixed rate over time with money that is worth less and less. Inflation eats loans. The dumbest thing you can do is pay off a loan with todays dollars during high inflation. People that win in inflation hold massive cheap debt on real assets. [their loan devalues to nothing AND their assets increase in value]