June 26th, 2008
The Fed held rates yesterday. The next meeting is August 5.
Although they adjusted their stance slightly to indicate inflation was beginning to pose a higher risk, they really can’t do much since the economy is still limping along. It really seems like they are just paying lip service and hoping their words, alone, can make the markets move.
We don’t see the Fed Funds changing in the short-term. We have seen CD rates on the 2-year to 5-year terms come up quite a bit. We finally have a nice yield curve. The 1-year rates are about 1.70 to 2.00% above fed funds. Hang in there.
The biggest problem I think for the economy is oil. If only our politicians would stop paying us lip service and let us go drill for our own. If we did that, you know prices would fall. The mid-east would fear losing their monopoly. Let me know your thoughts.
-- By +Chris Duncan