Nows the time to buy! Why? Read this article ...As expected, the Federal Reserve confirmed that it would end its bond-buying program known as Quantitative Easing (QE). QE is economist lingo for the Federal Reserve purchasing of bonds to lower long-term interest rates. So what does this mean? Ending QE isn’t “putting on the brakes.” It’s just easing off the accelerator. Rates will not rise overnight. The Fed’s bond holdings will naturally shrink over time as bonds come due. This will put pressure on the Fed to raise short-term rates by the middle of 2015 and long-term interest rates will follow. Many analysts predict mortgage rates will rise from 4.1 percent today to about 5 percent by the end of 2015. In addition we could see considerable short-term volatility in rates over the next six months as the Fed moves along this path, particularly because there is no longer any steady buyer in the market for mortgage-backed securities (MBS), with both the Fed and the government-sponsored enterprises shrinking their role within the market as investors. Like
Posted on: Sat, 15 Nov 2014 19:14:56 +0000
Trending Topics
Recently Viewed Topics
© 2015