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Higher Interest Rates

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BUSINESS
By New York Times News Service | November 6, 1994
It's still not too late to sell your bond funds, say investment experts who see even higher interest rates ahead.In the first nine months of 1994, Americans yanked a net $35.7 billion from mutual funds that invest primarily in bonds as rates rose and prices tumbled. That's pocket change, however: some $539.6 billion remained, according to the Investment Company Institute.Stubborn bond investors could be in for further bludgeoning. "You've still got more losses ahead in your bond account," said David M. Jones, chief economist at Aubrey G. Lanston & Co. "Sell your long-term bonds and move into shorter-term."
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BUSINESS
By Eileen Ambrose, The Baltimore Sun | July 26, 2013
Most checking accounts pay little or no interest, and fewer and fewer are free. But at Patapsco Bank in Dundalk, checking customers can earn about 2 percent a year in a free account or choose cash back or even iTunes rewards. And members of Money One Federal Credit Union in Largo can receive as much as 3 percent. Both institutions participate in a national rewards program for community banks and credit unions called Kasasa that helps them structure and market free checking accounts.
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BUSINESS
By William Patalon III and William Patalon III,SUN STAFF | August 29, 1999
Strong job growth continued to buoy spending during Maryland's second quarter, making the cash register ring and allowing home and car sales to set records.Higher interest rates and somewhat satiated consumers could tap the brakes on higher-dollar purchases during the current quarter and the fourth quarter to come. But fear not: Local economists expect the markets of Baltimore and Maryland to keep motoring, partly because a tremendous appetite for new workers is driving up wages and making more money available to spend.
BUSINESS
By Eileen Ambrose, The Baltimore Sun | April 29, 2013
College students taking out subsidized federal student loans will see their interest rate double in July unless Congress comes to the rescue. The rate on subsidized Stafford loans is a fixed 3.4 percent, but that's set to expire and revert to 6.8 percent for new loans issued starting in July. (Old loans stay at their current rate.) Subsidized loans, for which the government pays the interest while students are in school, are awarded to those in financial need. Unsubsidized loans, for which borrowers pay the interest, already charge 6.8 percent interest.
BUSINESS
By BILL BARNHART | August 14, 2005
IF THE FEDERAL Reserve were any clearer, there would be a billboard posted in Times Square: "Interest rates will increase!" After a year of boosting bank lending rates to pre-empt inflation, the Fed is not finished. The rule of thumb for investors says higher rates mean lower prices for stocks and bonds. When money costs more, it's harder for business profits to exceed the cost of money. Fixed-income investments you hold become less valuable in competition with higher interest rates paid by newly issued fixed-income securities.
BUSINESS
By STEVE BROWN and STEVE BROWN,THE DALLAS MORNING NEWS | October 29, 2005
SAN FRANCISCO -- A combination of higher interest rates and years of rising prices could soon take some air out of the hot U.S. housing market. "The boom is showing some signs of tiring," said David Lereah, chief economist with the National Association of Realtors. "We are looking at about a 4 percent drop in home sales next year. We are projecting a significant drop in the price appreciation pace." But even though the velocity of the housing market will subside, "we are looking for a soft landing," he told the Realtors' national convention in San Francisco yesterday.
BUSINESS
By Timothy J. Mullaney and Timothy J. Mullaney,Sun Staff Writer | January 20, 1995
Legg Mason Inc. said its profits fell 58 percent in the last three months of 1994, as higher interest rates froze public offerings for bonds and real estate investment trusts and drove investment banking revenues down to just over one-third of late 1993 levels.The Baltimore-based stock brokerage, best known for serving retail customers, said it earned $4.1 million during the quarter, the third of the company's fiscal year. That was down from $9.9 million in the same three months of 1993.Vice Chairman John F. Curley Jr. said the drop in stock and bond offerings was the main reason for the decline.
BUSINESS
By Kim Clark and Kim Clark,Sun Staff Writer | April 13, 1995
Mercantile Bankshares Corp. reported yesterday that higher interest rates and growing demand for real estate loans helped push first-quarter profits to $24.2 million, an increase of 11 percent compared with the same period last year.It was Mercantile's biggest quarter-over-quarter growth in profits since before the 1990-1991 recession.And it gave further evidence that the banking industry, which suffered from problem real estate loans in the early 1990s, has benefited from that sector's slow recovery.
NEWS
July 31, 2007
Historically, October has been the month for big financial busts. But this year, October could come early. Investors and ordinary citizens have good reason to worry about a perfect economic storm: a deepening loss of confidence in the dollar leading to higher interest rates; the higher rates bringing a crashing end to a hedge-fund, private equity and merger binge that has depended heavily on cheap borrowed money; the boom in bait-and-switch mortgages ending...
BUSINESS
By David Conn and David Conn,Sun Staff Writer | January 1, 1995
For all the concern about the damage higher interest rates may do to banks, it's important to remember one thing: Rates are higher because the economy is on the move, and that's always good for banks.Still, 1995 may prove to be a year on the tightrope for many banks, according to industry members and analysts.Banks will have to balance the benefits of a stronger economy, namely more consumer and business loans, with the potential costs: higher deposit rates. At the same time, some popular sources of nonlending income, such as securities sales and mortgage banking, are drying up."
BUSINESS
By Hanah Cho and Andrea K. Walker and Hanah Cho and Andrea K. Walker,SUN REPORTERS | August 19, 2007
Don't wait until you become delinquent on your mortgage payments or are facing foreclosure before seeking help. That's the key advice from housing counselors in the Baltimore area, who are trying to get struggling homeowners out from under ballooning mortgage payments. "The moment they're falling behind, or think they're falling behind, call us immediately," said Ashidda Khalil, director of the Baltimore office of the Neighborhood Assistance Corp. of America, a nonprofit housing advocacy group.
NEWS
July 31, 2007
Historically, October has been the month for big financial busts. But this year, October could come early. Investors and ordinary citizens have good reason to worry about a perfect economic storm: a deepening loss of confidence in the dollar leading to higher interest rates; the higher rates bringing a crashing end to a hedge-fund, private equity and merger binge that has depended heavily on cheap borrowed money; the boom in bait-and-switch mortgages ending...
NEWS
By Joseph Ganem | April 4, 2007
The collapse of some major subprime mortgage lenders has exposed a seamy side of the consumer finance industry. What has not been exposed is the math behind subprime loans and the deceptive transfer of wealth from consumer to lender that results from that math. Everyone knows that for a given loan amount, higher interest rates result in higher monthly payments. What people do not know is that in the early years of a subprime loan, the fraction of the higher monthly payment that goes toward reducing the debt actually decreases.
BUSINESS
By ANDREW LECKEY and ANDREW LECKEY,TRIBUNE MEDIA SERVICES | June 18, 2006
Higher interest rates and gasoline prices are infecting the family finances of millions of Americans in 2006. Not all at once, but a few dollars here and there gradually add up. Interest-rate, inflation, financial-market and pension worries make a midyear checkup more important than usual this year. Even if you made New Year's resolutions for your money, the scenario has since changed and your family situation may have too. Unfortunately, many Americans don't know where their money goes each month, which is a hazardous situation now that we're entering a period in which inflation could rise further.
BUSINESS
By RITU KALRA and RITU KALRA,THE HARTFORD COURANT | November 30, 2005
There was a time, before national banks and paper currency, that gold - not cash - was king. As it spiked over $500 per ounce yesterday, the first time it crossed that threshold since 1987, the regal metal that had been relegated to a relic for decades once again laid claim to its throne. Its message to investors: Watch out for inflation next year. Be particularly careful in the bond market, which signals the direction of interest rates. And, oh yeah, the stock market might not look too pretty, either.
BUSINESS
By TOM PETRUNO and TOM PETRUNO,LOS ANGELES TIMES | October 30, 2005
The way Wall Street moans about rising interest rates, it would seem that no good could come of them. Tell that to people with cash in the bank or in a money market mutual fund. When Federal Reserve policymakers meet Tuesday, they are almost certain to raise their benchmark short-term interest rate a quarter of a point, to 4 percent. It would be the 12th increase since mid-2004. That move should assure that rates on bank certificates of deposit and money market accounts will continue to move up as well.
BUSINESS
By Bloomberg News | November 16, 2003
The National Association of Realtors said mortgage rates that were less than 6 percent for most of the year will help propel U.S. home prices to a record increase. The median price for an existing single-family home likely will jump 8.8 percent to $172,100 this year, surpassing the record 14.4 percent rise in 1979 when the median price was $55,700, the Washington-based trade group said. Prices rose 7 percent last year to $158,200. The group said last week that the national median housing price during the third quarter jumped 10.1 percent to $177,000 compared with the corresponding three months of last year.
BUSINESS
By Lorene Yue | May 16, 2004
You might equate rising interest rates with higher loan repayments, but there are other ways you could feel the pinch. "There are lots of reasons why people should pay attention to interest rates right now, and it's not because they own a home," said Jennifer Openshaw, chief executive of Family Financial Network in Los Angeles. "[Interest rates] are the ultimate determiner of what we pay on everything from stock prices to auto loans to consolidating our debt." Many economists believe that later this year the Federal Reserve Board will start bumping up the federal funds rate, the rate banks charge when lending to each other, and the discount rate, what the Federal Reserve charges its banks to borrow funds.
BUSINESS
By STEVE BROWN and STEVE BROWN,THE DALLAS MORNING NEWS | October 29, 2005
SAN FRANCISCO -- A combination of higher interest rates and years of rising prices could soon take some air out of the hot U.S. housing market. "The boom is showing some signs of tiring," said David Lereah, chief economist with the National Association of Realtors. "We are looking at about a 4 percent drop in home sales next year. We are projecting a significant drop in the price appreciation pace." But even though the velocity of the housing market will subside, "we are looking for a soft landing," he told the Realtors' national convention in San Francisco yesterday.
BUSINESS
By BLOOMBERG NEWS | August 14, 2005
An index of U.S. mortgage applications fell 0.9 percent last week to the lowest level since the end of May, as rising interest rates made it less appealing for homeowners to refinance, a survey of lenders showed last week. The Mortgage Bankers Association's measure of home purchases and refinancing decreased to 745 in the week ended Aug. 5 from 752.1. Refinancing declined 3.3 percent. Mortgage rates that have increased in five of the past six weeks are deterring refinancing and may begin to put off potential homebuyers, economists said.
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