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Rob McAllister

Quantitative Easing?

Wednesday, October 13, 2010 - Article by: Rob McAllister - West Seattle Mortgage - Message

If you watch MSNBC or read the Wall Street Journal you might be hearing QE2 a lot. This is the new quantitative easing from the Federal Reserve...the 2 part just means this is round 2. The economy is not recovering as quickly as many of us would like and the president and congress are likely putting some pressure on the Fed to do something to help quickly since many of those in congress are up for re-election and arent looking so hot to their constituants right now who are still out of work.

The Fed has a lot of ways to help the economy along. The Fed has lowered rates as low as they possibly can at this point. The Fed also spent a lot of money early thist year purchasing mortgage backed securities on the market to keep rates low. It seems like nothing is working, but it likely is. The economy is growing at a very pathetic pace. This recovery is just goign to take longer.

If the Fed does another round of quantitative easing that should mean rates will stay low for a longer period of time...and may actually mean rates could dip a touch to reach their lowest levels...EVER! I am doubtful rates will fall much further...if at all, but QE2 may have some affect on rates event though I doub that will really help fix the issue with the economy and housing.

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