The FED is begins its 2 day meeting today to discuss what the heck is going on with our economy and how they can fix it. Or if they can fix it? That's the question we would all like to know. The general consensus is that they are going to drop the federal funds rate to 0.5%... some think 0.25%. Is this going to actually work? Has any of the prior cuts made a difference? I don't believe any of the cuts have started to work... yet. The LIBOR rate is also down to under 2%. The 30 yr-fixed rate averaged 5.47% last week... the last time we saw rates that low was in March of 2004 when the 30-yr average was 5.4%. Wish we had the same kind of activity as we did back then. It's interesting to note that prices have even come back to 04' level in a lot of areas... before the 05' appreciation boom. Where are all the buyers? Still sellers in most cases I'd imagine... Nothing can take the place of confidence.
The good news remains that it appears the FED is doing everything they can to stimulate the economy... Help bolster confidence? Now that all the banks have been paid back will they really stop hoarding all the cash and start lending? Will continued rate cuts be the panacea to cure the markets ills? They don't have much room to go. How about a 0% interest rate? Somethings gotta give! We'll see.
Make it a great day!
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