Could this be the start of an economic turnaround?

By
Real Estate Agent

Today's news that every major worldwide stock exchange index is UP as a result of the news that the Federal Reserve, in conjunction with the European Central Bank, the Bank of Canada and the Swiss National Bank, has agreed to loan banks money in exchange for debt that includes slumping mortgage-backed securities. 

Meridian Equity Partners' chief investment strategist, Peter Dunay, said, "The big problem has been the financials, and this helps supply money directly to the banks and may take some of the need for aggressive rate cutting off the table. The Fed is basically going to take the bad loans off the banks' books, and the market seems to be loving that idea."

With healthier loan portfolios, bank will be able to free up money for capital investment, which could spur our economy and avoid continued interest rates cuts that have seemed to have had little positive impact so far.

Today's move by the Fed could stabilize interest rates and home buyers may choose to BUY rather than sitting on the sidelines waiting for rates to drop even further.

For more on today's news, click on http://news.yahoo.com/s/ap/20080311/ap_on_bi_st_ma_re/wall_street

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Rainer
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Matt Crow
Huntley Realty - Huntley, IL
www.mattcrow.com 630-728-6051

JUST SAY NO TO THE CHARLIE GIBSON RECESSION!

Be of service! The rewards will come!

Mar 11, 2008 03:01 AM #1
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Kim Ray
BHGRE Metrobrokers - Blairsville, GA

Wouldn't that be awesome.

 

     


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Mar 11, 2008 03:02 AM #2
Rainmaker
568,004
Pam Joffe
Solaris Realty - Tampa, FL
Hi Don - I am ready for the turn around, it is definately time for the market to start picking up. Have a great day.
Mar 11, 2008 03:05 AM #3
Rainer
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.... - Mauldin, SC
I sure hope so Don. Thanks for the update.
Mar 11, 2008 03:09 AM #4
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Karen Kruschka
RE/MAX Executives - Woodbridge, VA
- "My Experience Isn't Expensive - It's PRICELESS"
Don,  I hope you undestand that if the feds let banks use risky mortgage backed securities as collateral the taxpayers will eventually pay for the bad loans
Mar 11, 2008 03:12 AM #5
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Jennifer Lamm
The Loan Gallery - Sunland, CA
I appreciate this information.... thanks!!
Mar 11, 2008 03:13 AM #6
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Don Phelan
Grand Rapids, MI
Five Star Real Estate
Karen, You're absolutely right; there is the possibility of that.  But it's nice to know that some of those taxpayers who will eventually pay for investment in those bad loans -- should it come to that -- are the Europeans, Swiss and Canadians!  I beleive that's why this news has caused the market to rebound today; the risk you describe -- while very real -- is being spread across a global economy and not on borne only the back of US taxpayers.
Mar 11, 2008 03:20 AM #7
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Don Phelan

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