Dec
16th
Tue
16th
ZIRP! I think I’m turning Japanese… I really think so
The Fed is going to cut the overnight federal funds rate to near zero — just like Japan tried to do in 2001. Let’s hope this move doesn’t mean we’re in for a decade long recession. This recession seems to be unique in many ways, and there seems to be a lot of pessimism about the future of the economy. There is another shoe left to drop in the housing market as the option-ARM loans and other non-subprime loans kick in with higher rates. Recently, 60minutes said that 10% of US homeowners are behind on their payments, but they didn’t compare that number to a “normal” rate — how many homeowners are behind on their mortgage when the economy is good?
