Rising Interest Rates Could Help Farm Prices Inflation. The interest rate hikes and devalued dollars of the late 1970 s and early 1980 s remain as fresh memories for the baby boom generation. Many had been in the workforce only a few years, or were just beginning careers, when the bottom fell out of the economy. Out of control growth and spending and insufficient economic oversight at the national level resulted in inflation and double-digit interest rates.
Improved controls are in place today but interest rates are beginning to bulge upward again.
It s a signal for Americans to pull in their belts, reduce unnecessary spending and increase savings. This is hard news for the farmer, because he pulled his belt to the last notch a long time ago. Various business sectors have produced fantastic growth and they say companies are valued artificially high. This, however, has not been true for farmers. No matter how hard they try to operate conservatively, there is always another factor to increase production costs, reduce sales and diminish net farm income.