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To: Pat Hughes who wrote (53023)8/27/1998 10:35:00 PM
From: Ingenious  Respond to of 61433
 
Lower interests rates could come about because of a "flat" yield curve according to CNBC commentary this morning. I am not sure exactly what this means. Perhaps, it is a comparison of the rates for short term and longer term notes. If the short term notes have approximately the same yield as the long term notes, this could dry up the demand for short term money since people would rather take longer to payback (lower payments over time and lower risk to take a loan). This may cause the FED to lower short term rates to stimulate short term lending and more liquid markets.

Any other thoughts why interest rates might be lowered?