It's inevitable that the interest rates will have to go up. We're finally heading back to a level of normalcy. What will be interesting to observe is whether the consumer tax cuts will do short term harm to the economy in that we will be stimulating an already hot economy. IMHO, the corporate tax rate cut may be key here since this has the potential to raise the economic capacity of the U.S. economy by bringing more jobs back. Again, short term heat but could result in longer term gain to keep the expansion humming.

Interest rates HAVE TO rise - if for nothing more than to give the Fed ammunition to fight the next recession that comes down the pike.

https://www.wsj.com/articles/markets-be-...1518623914

Quote:With the economy throwing off more heat, the biggest risk for the Federal Reserve is that it falls behind on raising interest rates. And if investors suffer as a result? So be it.

Inflation picked up again last month. The Labor Department on Wednesday reported that consumer prices rose 0.5% in January from December, putting them 2.1% above their year-earlier level. Core prices, which exclude food and energy, rose 0.3% for a 1.8% gain on the year. Both measures were stronger than economists expected.

No one economic report is ever conclusive about anything, but the inflation figures were just the latest batch of data suggesting the economy is running up against capacity constraints. The January job report, which kicked off this month’s sharp drop in stocks, showed unexpected wage growth — a sign that the job market has tightened to the point where companies need to pay workers more. The National Federation of Independent Business on Tuesday said the share of small businesses raising employee compensation was at the highest level since 2000.