Why interest rates are soaring and what it means for you – ABC News

Comment by tonytran2015: Your fiat money (Part 2)Inflation is vicious to fiat money users, Why do people buy Treasury Bonds with Negative Interests ?, The “Mean Realizable Present Value” of a future income, QE may be just another scam to steal national wealth,


Last November, if you bought an Australian government 10-year bond (essentially a government IOU) on the open market, you’d have been lucky to get an interest rate of 0.8 per cent. A fortnight ago, you could get a touch above 1.2 per cent. By Friday, it was just shy of 2 per cent….

…As new US President Joe Biden finalised his plan to splash around $US1.9 trillion on a stimulus package — the biggest on record — the market decided that all this stimulus, both monetary and fiscal, could only lead to one thing; inflation.

And that meant central banks would have to abandon their ultra-loose interest rate policies earlier than expected. The trickle of selling on bond markets suddenly swelled. By late last week, it was a tsunami. Bond prices collapsed forcing the yields — market interest rates — to soar.

The battle was on….