| Why do shares fall with rising interest rates | | | | percent return on investment, whereas the stock |
| When interest rates rise, the cost of borrowing | | | | market rate of return guarantee is not known why |
| increases, the people more reluctant to lend and | | | | should the investor his money in stocks? What if the |
| makes new development projects. In addition, if | | | | Bank at a 12% stakenot deposited money to |
| interest rates rise to make people more for their | | | | encourage these investors to pull money in stocks, |
| money back if they arise in the bank because of | | | | to put it in banks?- Money rates |
| higher interest rates. These two reasons together to | | | | The economy is slowing down |
| influence stock prices in the following paragraphs I will | | | | If the interest rate goes up, increases the cost of |
| explainexact process leading to change at this price | | | | financing new projects and thus discourage the |
| after the interest rate moves.- Money rates | | | | people to make new projects. This leads to a |
| People are discouraged from risk their money in | | | | downturn in the economy through the slowdown in |
| stocks | | | | business activity, and since the whole economy is |
| This combination can, pull people from the purse | | | | linked to begin existing companies, less profits due to |
| money to put it in banks. After all, if the bank is a 6 | | | | theSlowdown. |