The Fed’s Interest Rate Decision
The Fed did not announce today about extending their buying of mortgage-backed securities. I wasn’t expecting them to announce it now. I think they will wait until the end of March if they are going to do anything. They like to keep everyone on their toes and surprise you. That way if they do announce they will extend it anyone who may have just closed with a higher rate will have lost additional monies for the life of the loan. Life can be unfair and so can our government.
Here is what The Wall Street Journal reported and I certainly do not agree with the last sentence of this.
“The Federal Reserve offered a slightly rosier economic outlook and reaffirmed it would stop buying mortgages in March, on the eve of the Senate vote Thursday on Ben Bernanke’s nomination for a second term as Fed chairman. The Fed’s policy-making arm, the Federal Open Market Committee, said it would continue to keep interest rates near zero for an “extended period,” meaning at least several more months, according to a statement released Wednesday after a two-day meeting. But in the first sign of dissent in a year, Thomas Hoenig, president of the Federal Reserve Bank of Kansas City, voted against the action, saying the economy and markets were strong enough for the Fed to remove its commitment to keep rates low.”