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Article: Schools brief: how low can they go? (economic aspects of low interest rates)
- Article from:
- The Economist (US)
- Article date:
- December 2, 1995
CopyrightCOPYRIGHT 1995 Economist Newspaper Ltd. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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LOW interest rates. This happy goal seems to trail only jobs and growth on the wish list of politicians and economic pundits. A rise in central-bank interest rates is always reported as bad news, a cut in rates as good news. In America, Republicans who are hell bent on balancing the budget remind voters of the "benefit" of lower interest rates that fiscal responsibility will bring. And many governments, rich and poor, consider cheap capital to be so beneficial that they intervene directly in credit markets to keep borrowing rates low.
Low interest rates do provide benefits, of course. Households enjoy cheaper loans for homes, cars and other big purchases. Cheap ...