top of page
Search
  • Demitry Omrin

FUTURE VALUE OF MONEY

There is no doubt that inflation is creating pressure on interest rates to rise. To understand what is likely to occur with interest rates going forward, I believe one important variable to look at is what the low interest rate environment has created. Low cost of capital has certainly created opportunity by allowing businesses to grow but it is also responsible for inflated asset valuation levels that have come mostly from the ability to borrow. In other words, there is an inverse relationship between interest rates and valuation levels. If so, to suggest that interest rates should climb drastically would seem unrealistic because it would cause valuation levels to become "hollow" and collapse. While anyone's view on the future should be taken with a grain of salt, I believe that as long as valuation levels remain heightened it would be prudent to believe that we will be in a relatively low interest rate environment. That does not mean that rates will not rise - but to levels that are more realistic for the longer term. #money #future #interestrates #recg #commercialrealestate #economy #boc #bankofcanada #commercialvaluations



https://www.mpamag.com/ca/news/general/rate-hikes-just-beyond-the-horizon-former-boc-adviser/311913


1 view0 comments

Recent Posts

See All

An old address has been re-configured for the new era. 10 Dundas Street East in downtown Toronto has been completely overhauled. Everything from one of the largest digital billboards in the country to

Office workers at Google are apparently venturing back into the office despite the OMICRON variant. I see this as a sign that people are coming to terms with the fact that the answer to dealing with C

Employee's are now apparently including the flexibility to work remotely as a health benefit according to a recent survey. During the onset of the pandemic I felt that there was too much uncertainty o

bottom of page