The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: Moominoid who wrote (88731)	9/11/2007 10:42:07 AM
From: GraceZ	Read Replies (4) of 306849

I thoroughly understand how the current mechanism works. While you seem to think, it's only the FF rate and who cares what rate banks use to make interbank loans, all the other short term interest rates are directly or indirectly influenced by this rate. Important (to you and me) rates like the prime lending rate. What I'm trying to get you to see is that the Fed interferes in setting the price of what could be (and should be) set by a free market. They do this to engineer the economy, to engineer prosperity and they have no business engineering the economy because it isn't possible for them to know where the economy should go. It's the last vestige of a command economy in what is suppose to be a free market capitalist economy. It isn't even possible for them to know how much money should be in the system. They are constantly using monetary policy to correct past monetary policy mistakes. Just about all the problems that people complain about here and elsewhere are caused by their interference.

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