Stock Market, Interest Rate | featured news

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.

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

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.

Stocks resumed their downward slide in early trading Wednesday as investors retreated from the initial optimism that greeted the Federal Reserve's decision the day before to keep interest rates low.

The stock market continued its advance of the past month after the Fed said it would keep interest rates low to revive the economy.