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On September 18, the Federal Reserve unexpectedly lowered the federal funds rate by half a percentage point and the discount rate by the same amount. Wall Street was elated: stocks leapt 2.5 percent. Warning: the dollar continued to plummet and gold rose. Inflation may well be on its way. This was an indication that new Fed chief Ben Bernanke, like his predecessor Alan Greenspan, cares more about Wall Street than Main Street. These cuts won't bail out mortgage holders whose rates will jump 2 percentage points in the next year or so. San Diego will remain one of the nation's weakest housing markets, as foreclosures continue to zoom. "You can't re-inflate an asset bubble that has already burst," says Robert Campbell of San Diego's Campbell Real Estate Timing Letter. His Real Estate Crash Index is at its lowest reading "by far" since it was started in 1982.
On September 18, the Federal Reserve unexpectedly lowered the federal funds rate by half a percentage point and the discount rate by the same amount. Wall Street was elated: stocks leapt 2.5 percent. Warning: the dollar continued to plummet and gold rose. Inflation may well be on its way. This was an indication that new Fed chief Ben Bernanke, like his predecessor Alan Greenspan, cares more about Wall Street than Main Street. These cuts won't bail out mortgage holders whose rates will jump 2 percentage points in the next year or so. San Diego will remain one of the nation's weakest housing markets, as foreclosures continue to zoom. "You can't re-inflate an asset bubble that has already burst," says Robert Campbell of San Diego's Campbell Real Estate Timing Letter. His Real Estate Crash Index is at its lowest reading "by far" since it was started in 1982.