Navigating the Impact of Rising Interest Rates

The era of low interest rates is over, with the Fed transitioning from punishing savers to punishing borrowers. While higher rates benefit those relying on income for retirement, they pose challenges for borrowers. Investors no longer need to reach for yield, as money market funds are offering attractive rates. However, high interest rates are negatively impacting the housing market, with mortgage applications at their lowest level since 1995. Auto loans and credit card rates have also surged, making it harder for borrowers to service their loans. The market pendulum constantly swings between extremes, reminding us that there is no "Goldilocks" scenario.