Ok, the Fed finally hiked rates by a whooping 1/4% ….
A common view: “geez, is the economy so bad that it can’t absorb a measly 25 bps increase in interest rates?”
Obviously, .25% isn’t enough to sway many corporate investment decisions … most corporate investments are projected to return mucho above the firm’s cost of capital … not mere quarters of a point. Reality is that firms have hurdle rates way above their cost of capital, reflecting implicit risk and organizations’ limited implementation capacity.
So, what’s likely to be the major impact?
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Here’s my take…
The Homa Files 