🔥 Decide on the interest rate on September 18 and the odds that the Loan Interest Rate will be lowered. Will it help the Market increase? Let's discuss some ideas with e Dat and then we'll have a discussion.
- Normally, lowering interest rates is encapsulated in a few phrases: Stimulus, Cheap Money, Liquidity, Recession…
- STIMULUS: The typical purpose of lowering interest rates is to stimulate the economy, stimulate consumption, access credit, and create the effect of "the rich."
- CHEAP MONEY: Understand today that borrowing the same amount of money at a lower interest rate is like buying an item that is on sale; the cost is lower = cheap money => stimulation. Consumer impact increases.
- LIQUIDITY: Lowering interest rates goes hand in hand with printing money….Usually, continuous lowering of interest rates makes liquidity the most visible, due to the ability to convert assets into cash quickly, a large amount of available money, and loans always being available. Therefore, the market is often active…cash flow is easy. And vice versa.
- RECESSION: Many are currently confusing the concept here… fundamentally, lowering interest rates does not cause economic recession, but "lowering interest rates" is a necessary reaction, an adjustment because the economy is in recession or about to enter a recession! Therefore, stimulating to save the economy is… normal.
That’s why when interest rates are lowered, the market often increases, due to the above reasons + the bond market and savings accounts are no longer attractive, investors and organizations need to find areas with high profits… such as stocks or crypto.
🔹Supplementing the effect of "the rich" = Cheap money -> more people invest in various areas -> have profits or own many different assets = ATSM that having a lot of money = Rich = Stimulates consumption 😁
Let's discuss lowering interest rates together with the group.✨