Fed cuts is halloween treat
Well, the highlight of his Halloween trading day was the Federal Reserve deciding to cut the discount rate to 5 percent and lowering its target rate for the fed funds to 4.5 percent. A 1/4 percent cut for each.
Doug Duncan, chief economist for the Mortgage Bankers Association, said earlier this month he anticpated a 25-basis-point reduction in the fed funds rate which could be the last adjustment needed to reach a “neutral” poisition that allows for a moderate growth while keeping inflation in check.
A bigger cut in the fed funds would have helped the housing market more, but we’ll take whatever help we can get to turn this market around. I really believe the majority of the problem at this point is psychological. The herd mentality is slowing awakening and will soon start to move the market. Just my opinion, but I guess it’s as good as anyone’s on wall street.
Have a safe and Happy Halloween! Boo!