Stocks Heading Higher Ahead of Fed

Miranda Marquit — Wed, 04 Nov 2009 19:05:04 +0000

The Federal Reserve should be announcing its interest rate decision later today, and stocks are heading higher on the assumption that the Fed is likely to keep interest rates near 0%, as well as the expectation that the Fed will keep stimulus help coming in. Indeed, what Ben Bernanke says about economic policy going forward is more likely to influence the stock market than just about anything else today, and expectations that he will play up the fact that we’re only at the beginning of the recovery, and that there will be a continued need for economic stimulus for some time, have the stock market rallying.

Wall Street is hopeful that policymakers will continue to prop up the big companies, and focus on helping the banking system retain its stability. Investors will also be waiting to see what sorts of the things the Fed is mind for ensuring that the economic growth seen in the third quarter will be sustainable. Also of interest is how Bernanke and the rest of the Federal Reserve members plan to withdraw from the stimulus.

Withdrawing from economic stimulus is an important consideration for many, since it will be a delicate maneuver. If the stimulus measures are in place for too long, we could end up with hyper inflation and a number of other distressing economic problems. On the other hand, if economic stimulus is withdrawn too soon or too quickly, the economic recovery could be in danger, and the chances of a double-dip recession increase. With employment still an issue, and the housing market still reliant on the first time home buyer tax credit, though, it is unlikely that an exit from the stimulus will begin until sometime next year.

Image source: Daylife

Post from: EveryJoe

Stocks Heading Higher Ahead of Fed

Federal Reserve Gives Home Buyers More Protection Against Shady Lending Practices

sscatz — Mon, 14 Jul 2008 16:33:45 +0000

Fed Adopts Plan to Wrap Borrowers in Giant-size Condoms

The Federal Reserve approved a plan that would crack down on dubious lending practices that have hurt many of the riskiest “subprime” borrowers.

The plan would bar lenders from making loans to panhandlers, bums and hobos. In addition, the proposal would require lenders to make sure risky borrowers set aside money to pay for taxes and insurance, and send bank personnel out to do borrowers’ laundry.

According to Susan Wachter of the University of Pennsylvania’s Wharton School of Business, “Clearly this is closing the barn door after the fact.” Professor Wachter goes on to say, “Of course, if there’s a homeless guy sleeping in the barn who has no visible means of support, he’ll probably try to get a mortgage on the barn and some dumb banker will probably give it to him.”

New owner of 5,000 sf Tribeca loft

Post from: EveryJoe

Federal Reserve Gives Home Buyers More Protection Against Shady Lending Practices

EveryJoe » federal reserve

Stocks Heading Higher Ahead of Fed

Federal Reserve Gives Home Buyers More Protection Against Shady Lending Practices

Fed Adopts Plan to Wrap Borrowers in Giant-size Condoms