Paying down debt is the same as
a return at that interest rate.
Not exact matches
Buoyed by uncommonly low
interest rates, the industry has boasted of double - digit
returns; the past few years,
at least anecdotally, have been especially rich.
Important factors that could cause actual results to differ materially from those reflected in such forward - looking statements and that should be considered in evaluating our outlook include, but are not limited to, the following: 1) our ability to continue to grow our business and execute our growth strategy, including the timing, execution, and profitability of new and maturing programs; 2) our ability to perform our obligations under our new and maturing commercial, business aircraft, and military development programs, and the related recurring production; 3) our ability to accurately estimate and manage performance, cost, and revenue under our contracts, including our ability to achieve certain cost reductions with respect to the B787 program; 4) margin pressures and the potential for additional forward losses on new and maturing programs; 5) our ability to accommodate, and the cost of accommodating, announced increases in the build
rates of certain aircraft; 6) the effect on aircraft demand and build
rates of changing customer preferences for business aircraft, including the effect of global economic conditions on the business aircraft market and expanding conflicts or political unrest in the Middle East or Asia; 7) customer cancellations or deferrals as a result of global economic uncertainty or otherwise; 8) the effect of economic conditions in the industries and markets in which we operate in the U.S. and globally and any changes therein, including fluctuations in foreign currency exchange
rates; 9) the success and timely execution of key milestones such as the receipt of necessary regulatory approvals, including our ability to obtain in a timely fashion any required regulatory or other third party approvals for the consummation of our announced acquisition of Asco, and customer adherence to their announced schedules; 10) our ability to successfully negotiate, or re-negotiate, future pricing under our supply agreements with Boeing and our other customers; 11) our ability to enter into profitable supply arrangements with additional customers; 12) the ability of all parties to satisfy their performance requirements under existing supply contracts with our two major customers, Boeing and Airbus, and other customers, and the risk of nonpayment by such customers; 13) any adverse impact on Boeing's and Airbus» production of aircraft resulting from cancellations, deferrals, or reduced orders by their customers or from labor disputes, domestic or international hostilities, or acts of terrorism; 14) any adverse impact on the demand for air travel or our operations from the outbreak of diseases or epidemic or pandemic outbreaks; 15) our ability to avoid or recover from cyber-based or other security attacks, information technology failures, or other disruptions; 16)
returns on pension plan assets and the impact of future discount
rate changes on pension obligations; 17) our ability to borrow additional funds or refinance debt, including our ability to obtain the debt to finance the purchase price for our announced acquisition of Asco on favorable terms or
at all; 18) competition from commercial aerospace original equipment manufacturers and other aerostructures suppliers; 19) the effect of governmental laws, such as U.S. export control laws and U.S. and foreign anti-bribery laws such as the Foreign Corrupt Practices Act and the United Kingdom Bribery Act, and environmental laws and agency regulations, both in the U.S. and abroad; 20) the effect of changes in tax law, such as the effect of The Tax Cuts and Jobs Act (the «TCJA») that was enacted on December 22, 2017, and changes to the interpretations of or guidance related thereto, and the Company's ability to accurately calculate and estimate the effect of such changes; 21) any reduction in our credit
ratings; 22) our dependence on our suppliers, as well as the cost and availability of raw materials and purchased components; 23) our ability to recruit and retain a critical mass of highly - skilled employees and our relationships with the unions representing many of our employees; 24) spending by the U.S. and other governments on defense; 25) the possibility that our cash flows and our credit facility may not be adequate for our additional capital needs or for payment of
interest on, and principal of, our indebtedness; 26) our exposure under our revolving credit facility to higher
interest payments should
interest rates increase substantially; 27) the effectiveness of any
interest rate hedging programs; 28) the effectiveness of our internal control over financial reporting; 29) the outcome or impact of ongoing or future litigation, claims, and regulatory actions; 30) exposure to potential product liability and warranty claims; 31) our ability to effectively assess, manage and integrate acquisitions that we pursue, including our ability to successfully integrate the Asco business and generate synergies and other cost savings; 32) our ability to consummate our announced acquisition of Asco in a timely matter while avoiding any unexpected costs, charges, expenses, adverse changes to business relationships and other business disruptions for ourselves and Asco as a result of the acquisition; 33) our ability to continue selling certain receivables through our supplier financing program; 34) the risks of doing business internationally, including fluctuations in foreign current exchange
rates, impositions of tariffs or embargoes, compliance with foreign laws, and domestic and foreign government policies; and 35) our ability to complete the proposed accelerated stock repurchase plan, among other things.
If mortgage
interest rates were higher, paying down this debt would make more sense, but with
rates at about 4 percent, investing that money could yield a higher
rate of
return.
While
at the beginning of 2011 trading in euro - dollar futures was still foreseeing a
return to typical
interest rates over the next few years, that view has given way to expectations that
rates will remain low for a decade to come.
If you look
at a 10 - year forward basis, lower
interest rates lead to lower equity
returns.
By secular reflation, we mean
at least a decade in which short - and long - term
interest rates stay habitually below nominal GDP growth and high grade bonds are not really bonds any more: delivering trend
returns that are close to zero or even negative.
With
interest rates at record lows, family and friends may be willing to take a higher risk for a higher short term
return.
Carry trade is a trading strategy that involves borrowing
at a low
interest rate and investing in an asset that provides a higher
rate of
return.
And with
interest rates at all - time lows and stocks
at all - time highs, there are many who expect that not only will a 60/40 portfolio deliver below average
returns, but that bonds might not provide the protection they once did.
Given that U.S. short - term
interest rates are stuck
at zero, and are likely to remain unusually low for some time even if the Federal Reserve starts to raise
rates later this year,
return for cash this year is almost certain to be negative.
Moderate
interest rates were associated with a whole range of subsequent
returns over the following decade, and we know that those outcomes were 90 % correlated with the level of valuations
at the beginning of those periods (on reliable measures such as market cap / GDP, price / revenue, Tobin's Q, the margin - adjusted Shiller P / E, and others we've presented over time - see Ockham's Razor and the Market Cycle).
The reality is that one doesn't need
interest rates reasonably estimate 10 - year prospective market
returns, just as one doesn't need
interest rates to calculate that a $ 100 expected payment in 10 years,
at a current price of $ 65, will result in an expected total
return of 4.4 % over the coming decade.
What's actually true is that yield - seeking speculation in response to quantitative easing and zero -
interest rate policies has elevated current valuations, giving investors
returns (
at least on paper) that they would have waited many more years to accrue.
For much of the past two years, the discounts offered by automakers have remained
at levels that industry analysts say are unsustainable and unhealthy in the long term... Sales are expected to drop further in 2018 as
interest rates rise and more late - model used cars
return to dealer lots to compete with new ones.
Put simply, even taking account of current
interest rate levels, and even assuming that stocks should be priced to deliver commensurately lower long - term
returns, we currently estimate that the S&P 500 is about 2.8 times the level
at which equities would provide an appropriate risk premium relative to bonds.
We allow that short - term
interest rates may be pegged well below historical norms for several more years, and we know that for every year that short - term
interest rates are held
at zero (rather than a historically normal level of 4 %), one can «justify» equity valuations about 4 % above historical norms — a premium that removes that same 4 % from prospective future stock
returns.
They form hedge portfolios from extreme fourths (quartiles) of ranked currencies, rebalanced annually
at year end, and calculate
returns in excess of short - term
interest rates.
Thus, if we look
at bonds from a historical perspective,
interest rates are very low — which is great for those borrowing money — but not so great for those that wish to see higher
rates of
interest, and
return, on their money.
These are helpful.You are right that market failures have hit elder popluation in heavy way in past decade or so, and on top of that the fed locks
interest at artificial
rate low, so if we did save like our wise elder and financial advisors told us to do, we now get about nothing
at all in
interest return on those life savings.
The unit's
return on assets,
at 6.7 percent, is some seven times better than its owner's 0.9 percent, a sign of both OneMain's lower costs and the higher
interest rates it charges customers.
Whereas in most markets an increase in short - selling puts pressure on the lending market and pushes up the
interest rate at which short - sellers can borrow the underlying stock, the ready supply of gold loans from central banks seeking to earn some
return on their gold holdings has, until recently, helped to keep lease
rates low, generally in the range of 1 — 2 per cent (Graph B3).
At the annual shareholders meeting this year, Buffett explained that he thought Berkshire Hathaway's intrinsic value grew at an average annual rate of about 10 % over the last decade, but he warned that future returns would be lower if interest rates remained near generational low
At the annual shareholders meeting this year, Buffett explained that he thought Berkshire Hathaway's intrinsic value grew
at an average annual rate of about 10 % over the last decade, but he warned that future returns would be lower if interest rates remained near generational low
at an average annual
rate of about 10 % over the last decade, but he warned that future
returns would be lower if
interest rates remained near generational lows.
Let's
return to that example of $ 35,000 in student loans
at a 5.70 %
interest rate.
«You can borrow possibly with only five percent down
at approximately a four percent
interest rate and buy a property that may generate
at least a seven percent
rate of
return annually, which greatly magnifies the
return on your equity invested,» says Ailion.
At higher
interest rates, banks would have more options to generate
returns while taking less risk (Federal Reserve's ultra-low
rates have pushed financial market participants into riskier behaviors such as taking higher
interest rate risk, credit risk, etc):
Therefore, artificially low
interest rates subsidize investment in low -
return opportunities
at the expense of investment in high -
return opportunities.
In part this increase was due to an increase in the cash
rate in light of inflationary pressures building on the back of the boom in the resource sector, as well as reflecting the increasing
return to capital in Australia
at that time; thereafter,
interest rates declined sharply in response to the global financial crisis.
Indeed, because the level of
interest rates at any point in time is highly correlated with the level of nominal economic growth over the preceding decade, the relationship between starting valuations and actual subsequent S&P 500 nominal total
returns is nearly independent of
interest rates.
I won't have that so I see a third option as maintaining a permanent - ish portfolio, then diversifying into property
at or near retirement by paying off a buy to let mortgage (unless rising
interest rates — or poor
returns — have already made this cost effective).
But
at what
rate is the
interest you earn taxed and how can you get the best possible investment
returns from a savings account?
Because prospective 12 - year annual market
returns have never failed to reach
at least 8 % by the completion of a market cycle, regardless of the level of
interest rates, we view a 40 % market decline as a rather minimal target over the completion of this market cycle.
The stock should provide excellent annual
returns during the 5 - year period where
interest rates increase
at the fastest pace.
While fixed annuities offer the opportunity to accumulate value
at a fixed
rate of
interest, variable annuities offer investment flexibility that might generate higher
rates of
return, based on the performance of your underlying investments.
Importantly, when a preferred share is trading
at a high current yield relative to the market yield, the investor receives a measure of protection from the impact of rising
interest rates (or, if we're focused on real
returns, the impact of rising inflation).
At the above poster, it definitely makes sense to pay off certain debts before investing especially if they are at high interest rates because it's a guaranteed retur
At the above poster, it definitely makes sense to pay off certain debts before investing especially if they are
at high interest rates because it's a guaranteed retur
at high
interest rates because it's a guaranteed
return.
With the
interest rate on a 10 - year government bond
at roughly 2.3 percent, after - tax inflation adjusted
returns may well be negative.
As you can see, the one percentage point increase in
interest rates results in a loss for Year 1, but by Year 2 the cumulative
return turns positive because
interest and principal reinvest
at higher
rates.
These valuations might be reasonable on the assumption that short - term
interest rates will be kept
at zero for more than 30 years, but our impression is that what's actually going on is that investors feel they have «nowhere else to go» and — as in 2000 and 2007 — are speculating without a clear recognition of the dismal long - term
returns that are now priced into equities.
The reason why DAI stays stable
at just around one USD is due to the fact that the dynamic
interest rates investors can receive in
return for holding DAI and a minor amount fees being taken which allows for there to be a stability around the price of DAI.
With thousands of construction workers out of work and
interest rates at record lows, there is a growing consensus that investing now in improving our infrastructure, particularly housing, would give an immediate boost to the economy, encourage more private sector investment, and give us a long - term
return as we strengthen our economy for the future.
Think of it like this, if you have a loan with an
interest rate of 3 %, but you have stock market investments that continually
return at 7 %, it is more profitable to maintain some level of investment rather than pay down all your debt in a sprint.
In the earlier study, students who toured an art museum expressed significantly stronger
interest in future museum attendance and actually
returned to the museum
at higher
rates than did the control group.
After issuing bonds paying
interest at, say, 5 percent, they would invest the proceeds and hope that they could earn a higher
rate of
return over the life of the bond.
Total -
return swaps involve only an exchange of the
returns on their underlying indices (namely, a stock index against a short - term
interest -
rate index)
at a pre-determined frequency.
In
return for your investment, you receive
interest payments
at regular intervals, based on a fixed annual
rate (coupon
rate).
This opportunity costs (as it is sometimes called in personal finance), is determined by taking a conservative investment
return rate (I'll use 7 % in this example) and figuring out how much $ 20,000 would become if it were invested
at 4 years
at 7 %
interest and then subtracting the initial $ 20,000.
With the
interest rate on a 10 - year government bond
at roughly 2.3 percent, after - tax inflation adjusted
returns may well be negative.
The downside to saving so much cash for a future car is that the
return on cash is capped
at the money market's
interest rate.
With dividend investing
returning to the forefront, especially with
interest rates at historical lows, here are some good reasons to own dividend stocks.