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I wouldn’t consider myself an economist, but I did take economics 101. Remember learning about this thing called supply and demand. Currently, the United States is printing money for free….or should I say 0% to .25%…..that is the overnight rate currently. The government has also increased borrowing which means we sell that debt off and the top 3 holders of our debt are:

1. Federal Reserve and Intragovernmental Holdings 4.785 Trillion (March 2009)

2. Mutual funds 769.1 Billion (U.S. Treasury securities)

3. China (mainland) 776.4 Billion

Now, it has been announced that the FED will start to pull back from buying Treasury securities sometime around March 2010. Economics 101, if demand for these go down then price will go up and that means interest rates. The problem though with predicting anything in the financial market is that it is never just that ONE item that causes movement. There are a lot of other factors that will cause interest rates to change, and this is just one of those causes.

Will interest rates go up tomorrow, next week, next month, next year……..that is very tough for anyone to predict and if someone can……..they would be on an island somewhere they own and not telling other people of their predictions.

What I will leave you with is this; The FED can’t keep giving away money at 0% to .25% and will have to raise the overnight rate and protect the weaking dollar. Historically when rates are low and the dollar is weak, rates raise and in my opinion the reason they have been kept low for this long is to help get America back on its feet.

That is why it is important to take steps now, and find ways to reduce the amount of debt you have.

www.jasonwroble.com “Taking a bite out of your biggest debt, YOUR MORTGAGE!”