Discussion in 'Trading' started by The Kin2, Dec 4, 2007.
Mid 2008 rates will be at 3%, according to futures. This is great news for consumers!!
Great news indeed. Prices going up. Consumers are going to love $5.00/gallon gas.
Yes, please explain why that is good for consumers. The fed funds rate does not change consumer interest rates.
of course they change consumer interest rates. Remember when we had 20% mortgages?? (because I can't)
As for $5 gas. Its still too low. Transit fares are anywhere from $4 to $7 round trip. It would be ideal if gas exceed the cost of transit. Bring on 5 6 and 7 dollar gas. All thats needed is a terrorist attack on Saudi Arabias oil infastructure. America would be better off for it
Consumer interest rates are dictated by supply and demand. Changing the fed funds rate can increase the supply of money in the banking system and thus have a small influence, but for the most part doesn't do anything for consumer rates. Many times consumer rates have gone in the opposite direction of the fed's movement.
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