The Federal Reserve raised a key interest rate by a quarter of a point to 5 percent last week. It’s probably not enough to put anyone out of business, but could cause people to think twice about taking on more debt. So the Business Journal asks:
How will the hike in the interest rates impact your business, if at all?
Bob Spivak
President and Chief Executive
The Grill on the Alley
Typically when they raise the interest rates it’s to slow business down, which is not good for restaurants. But this increase seems to be accepted by the public, and probably won’t have an effect on the economy at all. At the end of the day, it won’t affect my business. But when we get in a recession, and people start cutting spending, the first thing they do cut is restaurants. Ultimately, we’re probably a good barometer for what’s going on with the economy because there’s a psychological barrier to going out and spending $100 for dinner when the economy is down.
Barry Shore
Founder
Fax4Free.com
Well, I say thank you to Alan Greenspan. Yesterday was our largest day ever; we had the largest number of people we ever had coming to our Web site. We are an Internet business and as the market is responding with record levels and enthusiasm, our business is continuing to explode exponentially. But of course it was all serendipitous, and had nothing to do with the interest-rate hike.
Stephanie Taylor
Executive Producer
Blur Studios
I don’t think it will impact us at all. We’ll only be affected if the whole economy changes. We have a lot of different types of clients ad agencies, production companies, movie and other entertainment companies. Down the line, the ad agencies might get their budgets cut because their clients aren’t making as much money. But I don’t think it will affect us directly, not for a quarter of a percentage point. We don’t have to worry about it. We just don’t have anything that’s directly related to that.
Laurel Crary-Globus
General Manager
Beverly Center
I’m not sure it will have a dramatic effect on us at all. The stock market has been so strong, and tends to have a much bigger effect on our business activity. I really don’t think it will affect us negatively or positively or it will be moderate, if at all.
Erik J. Messinger[picnm3-22]
Senior Associate
Grubb & Ellis
I don’t think it will affect our business. It was a short-term rate change, which has little or no effect on the long-term cost of borrowing and won’t do anything to increase or decrease market-rate activity. The net of it is small change. Short-term interest rates have been going up in the past 30 days anyway, so it will change little or nothing from where we were 60 days ago.
