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Updated over 5 years ago,

User Stats

60
Posts
12
Votes
Vlad Denisov
  • Glendale, CA
12
Votes |
60
Posts

How do treasury rate effect economy?

Vlad Denisov
  • Glendale, CA
Posted

I read the article about the T rates and trying to understand some ideas that they propose. It says when economy is strong and expanding there are lots of opportunities for investors, so they demand a higher returns and buy less treasuries which drives treasury rate. 

1. Does it mean that the reason why treasury rate falls is that the economy becomes weaker? Is it the only reason and what could be other reasons?

2. When T rate falls, so the other interest rates.

3. That means that a buyer can buy more and pay less interest of that.

4. That means that RE market strengthens (Why? Just the fact that people CAN buy houses at a lower rate, and people buy more of those doesn't mean that RE market became stronger? Or it does?

5. If RE market strengthens it has a positive effect on the economy(why?) and creates more jobs(why?)

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