[gorillarick]

"You all better be out of debt"

So if our fiat currency turns worthless, what difference will it make?

[JGibson]

Originally Posted by Two Bills

How Will 8% Effect The Villages?

For the cash rich, very nicely thank you.

Almost like the 80s.

[DrMack]

Originally Posted by Normal

We own, but there are some great rental deals out there right now. The owner pays utilities, taxes etc. You just need to shop around. There is/was a large supply of rentals to choose from this past season. We had friends that had everything covered for 2 months for 2200 a month. They seem to be getting competitive with great prices and perks.

We rented our new designer home out for 3k a month and charge the renter for electricity and water. Wi-Fi is provided.

[justjim]

8% interest rates? New sales will be a bit less and house “flippers” will fold their tent and take a hike. Resales will see a significant price decrease and overall the economy will likely go into recession. However, perhaps this rather bold prediction by Jamie Dimon could be wrong.

[themartianchick]

We had two mortgages that were 8.5 % and 9.1%. That was the going rate in the early- mid 90s. We just did our best to pay them off early.

[Southwest737]

Great CD and MM rates. Works for me.

[MandoMan]

Originally Posted by Normal

3 days ago Jamie Dimon stated 8% rates are in our near future. Most cannot argue this because national debt is climbing well past GDP. How will this affect life here in the Villages?

Jamie Dimon—Head Of U.S.’ Largest Bank—Warns Of 8% Interest Rates Along With Recession

Your source, Forbes, actually says “ A chilly scenario for the U.S. economy, in which interest rates climb as high as 8% as the effects of the unprecedented monetary policy taken to combat inflation take hold, is still very much on the table, according to JPMorgan Chase CEO Jamie Dimon. . . .

“Coupled with Dimon’s concerns about the potential for “stagflation,” a recession characterized by lingering high inflation, he warned interest rates could soar to “8% or even more,” a far cry from the already 22-year high rates of over 5% and going against conventional wisdom of a looming decline in rates (U.S. interest rates have not been 8% or higher since 1990).”

Note that “conventional wisdom,” which tends to be more accurate, disagrees with his position. Note that he doesn’t say that this WILL happen, but COULD happen if monetary policy LEADS TO “stagflation,” which it hasn’t yet and probably won’t. Note that the monetary policy he is talking about is set by the Federal Reserve Bank, and the White House has NO SAY over that policy. If Trump is elected, the Fed will keep on doing whatever it thinks best with the same people making the decisions.

I believe that the Fed is doing a good job and making wise decisions, even if they aren’t the decisions many of us with less expertise would prefer. Dimon is charismatic and powerful, but he has made many predictions over the years that didn’t come true, as well as many that did.

[bowlingal]

national debt has been climbing for YEARS. This is nothing new.

[La lamy]

The insanely low interest rates for many years has been frustrating to me as an investor. Couldn't rely on any guaranteed savings. Very happy to finally have the tables turning towards savers and hopefully keep people from borrowing way too much.

[crash]

Originally Posted by Normal

Thank you autocorrect lol. Dimon knows what he is doing and sometimes yes, sometimes no. But most agree national debt is climbing well past sustainable levels. Something will give.

When you say most you must mean most who weren’t alive during the 70’s because interest then was over 12% and lo and behold we survived. Now 5% is considered high and we are headed for doom.

[Windguy]

Originally Posted by Normal

Thank you autocorrect lol. Dimon knows what he is doing and sometimes yes, sometimes no. But most agree national debt is climbing well past sustainable levels. Something will give.

It seems to me that people have been saying that for decades.

[Normal]

Originally Posted by Windguy

It seems to me that people have been saying that for decades.

Decades ago the US decided “deficit” spending didn’t matter and we were good for all our debt incurred. But that was back when debt was less than 1 trillion dollars. At some point though there is a ceiling on how much a government can borrow for spending. Debt is now upwards of 34 trillion, but there is much more to it than that. Borrowing (deficit spending) will come at increased servicing costs that used to be next to nothing. That cost will significantly increase on a very large amount that isn’t just a trillion dollars anymore.

Yes, we will all make more money of investments, but there could be cost reverberations.

[rsmurano]

Originally Posted by Craig Vernon

Watching the developer compete with pre-owned is fascinating. The entire pre-owned market is overpriced and not selling due to lack of adjustment in pricing related to interest rates. The developer is slashing prices on areas not selling and marketing Eastport against the two years of isolation that area will have related to the whole villages. Would you rather have a 2000 sq ft home for 400k with a fifty thousand plus bond or 450k-1 million for connected updated home with much less bond and a lower tax rate. Fun.fun.fun to watch.

Eastport isolated? Fenney has been more isolated. Newell and areas east are way more isolated. Try riding your golf cart to Truman golf course or to Loblolly, leave in the morning to get there in the afternoon. Of course the developer will have a sale on areas that don’t sell, like east of Newell close to 470 or Deluna next to 301. Car manufacturers do the same thing. Right now I have friends that have been in multiple lotteries with 50-75 other people vying to buy a new home in Eastport, and that is with higher bond prices. I have multiple friends move from fenney area to Newell with higher bonds but their property costs for pond or view were 1/2 or more than the cost in Fenney.
Used houses in our village are selling if they aren’t shooting for the moon in prices. I know of 3 houses selling for almost double what they paid for them 2-3 years ago and of course they are still on the market. But I have seen houses sell pretty quickly that have made $200k-$300k in 2-3 years.

[TeresaE]

Originally Posted by Normal

3 days ago Jamie Dimon stated 8% rates are in our near future. Most cannot argue this because national debt is climbing well past GDP. How will this affect life here in the Villages?

Jamie Dimon—Head Of U.S.’ Largest Bank—Warns Of 8% Interest Rates Along With Recession

In my experience and observations, the secret to a secure retirement is cash flow. Paying cash for a home ties up a large sum that you can likely never access. Why? because in retirement your earnings are diminished.

So qualifying for a home equity loan is nearly impossible. In other words, one becomes equity rich and cash poor.

Whereas carrying a mortgage allows you to preserve your cash. Cash for medical bills, home repairs, and even investments. Those investments may even offset the cost of the mortgage. So a 7.5% mortgage costs you 3.5% if the moneys you invested give a return rate of say 4.0%.

One last thought. If your mortgage payment, including taxes and insurance, is less than rent for the same property, then you win again. And nobody can kick you out by not renewing the lease. There’s a lot to be said for that kind of security.

[Wondering]

Originally Posted by Normal

3 days ago Jamie Dimon stated 8% rates are in our near future. Most cannot argue this because national debt is climbing well past GDP. How will this affect life here in the Villages?

Jamie Dimon—Head Of U.S.’ Largest Bank—Warns Of 8% Interest Rates Along With Recession

Most of the time Jamie Dimon is full of hot air. He was a big part of the mortgage collapse of 2008. If you are worried about the federal deficit, you should have thought about that back in 2017 with the big tax cuts for billionaires.