Interesting question.  There are some great debates over this issue with respect to our industry (REAL ESTATE).  There is probably little doubt that the Fed will lower the target for the Fed Funds by 1/4 percent (possibly by a 1/2%).  What does this mean for us in the real estate industry?  Hopefully with the lower short-term rates, this will help those with short-term financing tied to the prime rates.  In the end remember that the Fed plays a role in helping maintain a good supply of money in the market, but the market is driven by supply and demand.

Indirectly we hope to see a reduction in long-term interest rates and creating more money for the real estate market.  According to an article on CNBC today, the CEO's of both Fannie and Freddie are not expecting the market to pull out of the current situation until 2010. 

For us as agents that means a weeding out, and a better conviction to making the calls and driving business (Lead Generation).  The current situation will create an interesting dynamic, that to a large extent we have seen in our market before, but will add some new twists on how to compete and be profitable.

The good news is that buyers and sellers will need our services more now than in the past.  Buyers will need professionals to help them find and price homes reasonably.  Buyers remember you should never pay more than the current market.  Sellers, you'll need help in determining where you need to be to sell.  This current market will only get better for the professional who is not afarid to work!  Good Luck!