[quote=CA renter]
If you can hold all other variables constant, then asset prices — especially those that are dependent on credit, like houses — would fall when rates rise. If you doubt this, ask yourself why the Fed has been hammering rates down during the entire housing/credit bubble bust.[/quote]
Um… historical data doesn’t seem to support this…Between late 70ies to mid 80ies, didn’t interest rates rise from roughly 9% to 18%? But during that period, home prices gained 30%….
