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Politics : Formerly About Advanced Micro Devices
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To: bentway who wrote (369443)2/2/2008 1:07:42 PM
From: tejek  Read Replies (1) of 1582873
 
"The Fed is pushing on a string," said Peter Morici, an economist at the University of Maryland. "Unless you can significantly expand the ability of banks to provide credit, the Fed's efforts are not going to do much to ameliorate a slowdown."

Really........mortgagees are being hit with tons of calls for refi's. The average fixed mortgage in this country is 6.25%. Once rates drop a percentage point its worth doing a refi if you plan to stay in your home for 3-5 years. According to bankrate.com, the overnite rate for mortages on Thursday was 5.49% and dropping. Its expected rates will go below 5% at some point. Depending on the size of the loan, each refi can give the home owner an extra $2-300 per month on the coasts; less in the interior where home prices are lower. The banks make money doing the refi and the consumer has more money to spend every month. Its better than any stimulus package.

Plus, the reduced interest rates will lower the increase at the time of a mortgate reset on an ARM making possible for people to hold on to their homes. Less homes in foreclosure means less expense for lender banks.

I love the new buzz words of the month...."pushing on a string". People love using those words but apparently they really don't understand the full implications of the fed cuts.

In fact, I now am predicting that the housing market will bottom and start to recover in 2008.
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