Federal Reserve, Interest Rate | featured news

Fed Maintains Rates and Strategy

The central bank affirmed that it would keep up its existing efforts to stimulate the economy, even though it expected a return to moderate growth.

 

What Happens When The Federal Reserve Stops Artificially Boosting The Economy, And Should You Worry About It?

To quell the latest financial crisis, the Federal Reserve smashed interest rates to the floor by buying bonds with money it effectively prints. Since 2008 assets on the Fed’s balance sheet, including those bonds, have tripled, to $3 trillion. (Hey, people needed encouragement, and low rates are encouraging.) The mixed results: Entrepreneurs and homeowners got some relief, while savers got whacked along with the value of the U.S. dollar. Starving for yield, investors piled into stocks, pushing the Dow Jones Industrial Average to its all-time high, absent inflation.

 

Buffett: Low interest rates have boosted stocks

Billionaire investor Warren Buffett says stock prices have gotten a boost from low interest rates caused by the Federal Reserve's stimulus efforts.

 

Fed to Hold Rates Down Until Jobless Rate Is Below 6.5%

The central bank said Wednesday that it would maintain short-term interest rates near zero, even after it stops buying bonds, for as long as the unemployment rate stayed above 6.5 percent.

 

Bernanke makes strong defense of Fed rate policies

Ben Bernanke

Chairman Ben Bernanke offered a wide-ranging defense Monday of the Federal Reserve's aggressive policies to stimulate the still-weak economy. The Fed needs to drive down long-term borrowing rates because the economy isn't growing fast enough to reduce high unemployment, Bernanke said in a speech to the Economic Club of Indiana. The unemployment rate is 8.1 percent.

 

Fed, worried about job growth, launches new stimulus

Federal Reserve

The Federal Reserve, hoping to give another shot in the arm to the pallid recovery, announced it would launch a new round of a controversial bond-buying stimulus program. The central bank also further extended its pledge to keep short-term interest rates near zero, now through the middle of 2015.

 

Consolidation of small banks on the rise

A growing number of small and medium-sized banks are merging as shrinking profit margins, tepid loan demand and low interest rates place pressure on their operations. Conditions are unlikely to improve as the Federal Reserve contemplates another round of stimulus that could push rates even lower.

 

Weak open for stocks as P&G issues grim outlook

Investors appeared unimpressed Wednesday with the Federal Reserve's latest step to help the economy, an extension of a program to lower long-term interest rates. Stocks were little changed for the day, and the yields on Treasury bonds were trading about where they were before the Fed's announcement.

 

The 2% Catastrophe: How One Number Explains the Miserable Economy

Ben Bernanke

The Federal Reserve is crucifying the U.S. economy on a cross of two-percent inflation... The Fed makes a very simple promise: It promises to keep inflation at a certain level every year. That level has changed over the past 30 years, but it's currently around 2% a year. If the economy is running too hot, the Fed raises interest rates. If it's running cold, it lowers rates.

Senh: Good to know. That means if you put your money on CD's, you better make sure it makes at least 2% or you're losing money.

 

Fed, seeing moderate growth ahead, sticks with low-rate policy

Federal Reserve

Top Federal Reserve officials, saying the economy is expanding moderately, reaffirmed their pledge to keep short-term interest rates at record lows through 2014.

 

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