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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?


To: damainman who wrote (56839)3/25/2006 4:07:46 PM
From: CalculatedRisk  Read Replies (2) | Respond to of 110194
 
I don't expect them to try to support housing prices with rate cuts, but they are concerned about the impact of a slowing housing market on the economy (especially consumer spending and housing related jobs).

Several of the FED members have expressed concern about housing's impact on the economy. If other areas of the economy pick up (like business investment) then the FED will not worry about housing.



To: damainman who wrote (56839)3/25/2006 4:54:25 PM
From: Mike Johnston  Respond to of 110194
 
Didn't someone from the Fed specifically say that we shouldn't expect them to support housing with rate cuts?

Don't pay attention to what they say, but to what they do.
They have sounded rather hawkish lately, but monetization and money supply growth has shifted into a high gear. And rates at 4.50% are way too low given the level of inflation and money growth.

I believe that when housing falls off a cliff they will step in.