Quote:
Originally Posted by bizaro86
If wages are keeping up it is 100% rational to do as much spending as you can as soon as you can. If that 30k car is going to be 34k next year, buying it now makes sense even if rates are high.
Once enough people start doing that it effectively increases the supply of money because the velocity of money is much higher.
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But if people are buying that car on credit, rising interest rates will mean fewer people will be able to afford that car at $34K which will tend to depress the price as it will bring demand more in line with supply.