401K investments are done by plan administrators. Very little of the money will go into any interest earning accounts. Instead the invest in a series of stocks and bonds which (if everything goes well), increases in value.
They are both types of monetary policy. Tight has high interest rates and low supply, while loose has low interest rates and high supply.
low
High rates.However, high interest rates are usually a consequence of high inflation rates and so what matters is not the interest rate but the real interest rate which is the nominal interest rate relative to the inflation rate.Thus a 3% interest rate when inflation is 1% is better that a 5% interest rate when inflation is 4%.
There are many reasons high commodity prices and low interest rates help to maintain share prices. This keeps the market competitive.
high and low
There is not a direct link but high interest rates are associated with expectations of high rates of inflation. High inflation may be associated with high wage rises and so lower employment rates. Low employment rates would suggest excess labour supply. So, from one end of that chain to the other: high interest rates are associated with high labour supply.
Well you need to look at it from both the perspective of receiving interest payments and paying interest. In relation to paying interest, household savings generally decline with low rates. This is because when you are paying low interest rates on the things you purchase you are also receiving low rates on your savings. This usually has the affect of boosting the economy. If rates are low people are enticed to spend their money since a) they are getting a small return on their savings and b) borrowing money is costing them little. When interest rates are high it generally increases household savings for exactly the opposite reasons low rates decrease savings. High interest rates when borrowing also mean higher rates for saving. Economies that are experiencing high rates of inflation will raise interest rates. Nobody wants to pay alot in interest so as rates climb they borrow less and save more. This is removing money from the economy and putting it into savings thereby slowing demand for goods and increasing supply. This will usually reign in inflation, and increase household savings.
There is a lot of baggage borrowing from your 401k including that if you lose or change jobs the loan becomes due in full immediately. Personally, with interest rates as low as they are now I would do my best to avoid it unless it is absolutely the only way.
When interest rates are high, investors will consider investing in short term investments, instead of long term investments. When interest rates are low, investors will consider investing in bonds because they are safer.
Financial hawks favor low inflation over high economic growth, and want interest rates set high to keep inflation low. Financial doves prefer low interest rates and believe inflation has a minimal impact on society.
National average interest rates were as low as 4% for a mortgage. Assuming that it is what you are referencing. Interest rates are based on your personal credit score rather it be a mortgage, credit card, or vehicle. So how high they may go depends on the individual, the type of loan, and the lender.
Low inflation can have severe effects on interest rates and student loans. If the interest rates get too high it can become difficult for students to go to college.