The Double Whammy Squeezing Borrowers' PursesBy
It's no secret that consumers and businesses are beginning to feel the pinch of rising interest rates. And what makes the latest increases especially troubling is that for many borrowers, the real cost of credit--adjusted for inflation and the tax deductibility of interest payments--was already much higher than in previous recoveries. According to Zwen A. Goy, an economist at CS First Boston Corp., business loans made at the prime rate over the past year carried a real cost of 1.4%. In past recoveries, however, the real cost of prime rate loans fell to as low as -2.3%.
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.
- Uber Paid Hackers to Delete Stolen Data on 57 Million People
- European Stocks Erase Losses; Dollar Extends Drop: Markets Wrap
- Tesla’s Burning Through Nearly Half a Million Dollars Every Hour
- Two Biggest Risks Now Are China and Inflation, Market Veteran Says
- Jamie Dimon Says He'd Bet Donald Trump Doesn't Win Again in 2020