| John NorrisHolding rates steady likely best in the long run
Question: I saw the Federal Reserve didn't cut interest rates this week. Why aren't they paying attention to the problems in the housing, mortgage and stock markets? It seems a rate cut or two would go a long way in curing our economic problems in this country. Answer: You are absolutely right; a rate cut would give the housing, mortgage and stock markets a pretty good boost. As such, even though no one was expecting one this week, a lot of people were hoping the Fed would hint at a cut in the near future. Unfortunately, we don't appear any closer to one now than we did this time last week. So, why isn't the Fed paying attention to what is going on? Believe it or not, the Fed is painfully aware of what is going on. It just isn't at liberty to react in a knee-jerk fashion.
Fed leaves interest rate at 5.25%
The Federal Reserve, keeping interest rates unchanged, said yesterday inflation is still the biggest danger to the economy and that the six-year economic expansion won't be undone by tighter credit conditions. "Although the downside risks to growth have increased somewhat, the committee's predominant policy concern remains the risk that inflation will fail to moderate as expected," the Federal Open Market Committee said after meeting yesterday in Washington, where it left the benchmark rate at 5.25 percent. Some investors read the remarks to mean that chairman Ben S. Bernanke won't rush to cut rates in response to a rout in the subprime mortgage market that has prompted lenders to restrict borrowers' access to credit with higher rates and fewer down-payment concessions.
Briefly in Tompkins
The Danby town board will hold a public hearing at 6:30 p.m. today on a proposed law amending subdivision regulations. The hearing will run directly into a town board meeting where board members will vote today on whether or not to overhaul subdivision regulations. Prior to the last town board election, subdivision regulation laws were strengthened so that the town board would have a bigger voice in how town land is developed. If the proposed changes carry the majority vote, subdivision laws will be modified to give the town less influence in town land development. The proposed laws come from a task force reassembled by town planning board member Ray Van de Bogart. Volunteers needed for gift shop .
Max Fraad Wolff: The House That Debt Built
How America chooses to respond to the coming housing market pain will shape the fortunes of millions of families. It will shape political fortunes in 2008 and beyond. How did we get here? We don't save money and our earnings are stagnant. Real savings from personal income in America have been negative for a year. The Chart below is made of 100% US Government data. Notice the zig zag pattern and the total lack of improvement in real average weekly earnings. The graph forms a knife edge pattern. We have been riding that edge, our incomes cut along that serrated blade. It costs more to be middle class. The extra money is not showing up in inflation adjusted paychecks. The real earnings in the graph below are adjusted for inflation. They measure what you earn and what you can buy with it.
Stocks May See Weakness Amid Mixed Earnings And Subprime Concerns - RTTNews Daily Market Analysis
(RTTNews) - The major index futures are pointing to a sharply lower opening on Thursday. The earnings news of the day has been mixed, with Apple (APPL) reporting better than expected result, while Dow component Exxon Mobil (XOM) revealed a worse than expected performance. Traders may express concerns over loan defaults, which are seen as an offshoot of the unfolding subprime saga. A rebound in oil prices could also exert some downward pressure on stocks. Apprehension over the health of the economy following the release of softer than expected durable goods orders growth is also expected to prevent traders from taking positions. While strong earnings from companies such as Boeing (BA) and Amazon (AMZN) gave an early lift to the major averages in Wednesday's session, the momentum faltered by late morning trading.
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