Saturday, November 7, 2015

Interest rate and the stock market

Most likely, the rate hike will be insignificant in a year before election.

I bet a higher hike in 2016 that would cause the market to take a bigger breather due to:

1. High margin debt would collapse.
2. Less acquisitions and buyouts due to higher interest rate.
3. Bottom line would be hurt due to higher interest expenses.

The other risk is the strong USD.

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