The Impact of Low Interest Rates on Investments

Low interest rates make risky assets less valuable in tough market conditions, as they can only be sold at lower prices. Low rates make people more willing to lend for risky propositions, leading to competition for deals and acceptance of low returns and reduced safety. The availability of capital fluctuates significantly, with easy money making capital available to weaker borrowers for almost any purpose. This results in the shifting perception of high-tech companies, which were previously considered too undependable to be credit worthy.