I still have concerns about dwindling savings and increasing credit balances, as well as historically high APRs, but will worry about that another day.
Interest rates are NOT historically high. In fact they are basically right at "average". The rates for the last five years were historically LOW.
This FRED series only goes back 30 years but if you look at the Fed Statistical Abstract consumer credit tables, APRs in 1985 were < 19% and in 1980 were < 18% so 21% and higher are very exceptional.
https://www.bloomberg.com/news/articles/2024-07-24/share-of-... | https://archive.today/l6ryx
https://www.philadelphiafed.org/surveys-and-data/2024-q1-lar...
https://www.bloomberg.com/opinion/articles/2024-07-24/the-fe... | https://archive.today/xcJP5
The fed also changed their own metric for inflation. It's a political play.
There is also individual context to account for. Healthy metrics for a 20yo vs 80yo are very different
Trying to call for rate reductions now would be so poorly planned I hope you never get anywhere near the federal reserves power structures.
Cheaper mortgage rates means institutional capital that was otherwise sitting on the sidelines in T-bills will be deployed directly into that remaining supply.
(Also consider this: there is nothing more unproductive than real estate - the stupid capital must be forced out of the mattress and into productive ventures.)
