Reagan v. Mondale debate 1984

In My Humble Opinion
21

For capitalists, it worked great! For example, my grandparents sold a campground/mobile home park they built from scratch (with their son).

The sell price was $6 million. The terms of the loan was a floating interest rate, Prime + 4%.

Then Volcker comes in, decides to effectively float the prime rate, it shoots to 21% and my grandparents are clearing $1.5 million of interest income on a $6m loan every year… the damn monthly checks were $120k in interest.

Well, they would have earned that much had they not renegotiated the loan as to keep the purchasers solvent - in the end, my grandparents didn’t want the campground back, nor did they want a massive legal battle.

22

CDs and CD-Ladders used to be a relatively safe way to make some interest income, it was never going to be amazing, but it wasn’t a terrible place to park some portion of your money, particularly for stuff like say, savings for a house downpayment (obviously you’d pick maturity dates so they’d be available when needed) and things of that nature where your risk tolerance was quite low. It’s shocking that they are even offered as a product any more, anytime I see my bank list theirs on their website the rates are like sub-1%, and have been for like a decade or more.