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Author: mjcalab Two stars, 250 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 35397  
Subject: Re: CD rate up to 4.7% Date: 3/30/2005 1:17 AM
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mjcalab; What if rate 18 months from now is 7%??

First thing that comes to mind is that I would be very depressed because I would have very large losses in the stock market. But that's probably not what you are asking.

I'm under the impression that future interest rates cannot be predicted. So I feel ok with the highest rate at the lowest risk when I have funds to invest. If rates continue to go up as you indicate, I will calculate, along the way, the point at which I would be better off selling, taking into account the early withdrawal penalty, If there are good value stocks at low P/E and their dividends are close to the CD rates then I would probably buy stocks, otherwise I would look for the highest yielding lowest risk fixed investment.
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