Wednesday, March 19, 2008

Interest Rates Keep Falling

One has to ask if more interest rates are coming. Probably yes, but my guess is not many. With inflation running higher than the Fed wants it to be, two of the Board of Governors voted against the recent 75 basis point drop. I'm not sure lower rates is the answer. While we are not one, many banks are unwilling to take on credit risk due to a lack of confidence in the economy. No amount of rate cutting will change that.