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Theeris could help us indrestand the relation between intrest rate and performance of the
stock market
Keynes theorie
Intrest rate does not directly impact the stock market, The only direct impact is
that borrowing money from the Federal Reserve is more expensive for banks.
the impact is that that any increases in the interest rate would have a negative
impact on the consumption of cunsumer because the credi , When the interest
rate for credit cards increases, the amount of money that consumers can
spend decreases. businesses' revenues and profits decrease.
For business they are impacted directly because they will borrow money more expensive
from banks sot they may not borrow as much because they will pay higher rates of
interest Less business spending can slow the growth of a company—There may be a
decrease in earnings as well, which, for a public company, usually affects its stock price
negatively