| Interest Rates |
| You can
determine the direction of long term and short term interest rates by identifying the
factors that have the ability to move rates in either direction and are currently and in
the future will likely exert predominating forces. You can quantify a magnitude --- specify a range in the qualified direction --- by determining the relative impact each of those factors may have upon the economy and relevant industries over the given term. Macro thinking works well for this task. Micro thinking needs to factored in at appropriate points. It is these identifications and weightings that yield good guesses. When applied in physics this process is called vector analysis. |
| Not thought of by many, little understood by most, and often only guessed. |
| One of the most powerful forces impacting financial markets is interest rates. Interest rates should be factored in to most decisions and anticipated to have significant impact upon prices. |
| See also: Long-Term |
| The investment axiom that is always valid: Caveat Emptor |
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