Looking Back at April
In April, we had some noticeable swings in the stock market, although the S&P did end the month slightly up from where it started. Fear of quickly rising interest rates has been a major influence on market behavior. We have seen the 10-year Treasury bond rate go from 2.06% in September to 3.00% this week.
The problem with rising interest rates is they affect so many other areas of our economy. The Federal government, as well as corporations, have used this low-rate environment to borrow money, so as rates rise so will the cost of the money they borrowed. Consumers will pay more on new home mortgages, auto loans, existing and new credit cards along with almost anything else purchased with credit.