Fed's Next Move
With the new chairman of the Fed, the question is will they keep on raising the rates and continue Greenspan's legacy? For the past 20 months the Fed has raise the rates a quarter percent at a time and businesses are wondering if the Fed will cease the raising. The article refers to Bernanke as being the tough guy trying to show who is boss but despite the media thinking that there will be another rate increase, professionals thinks otherwise. There are many assumptions about the May 10 meeting. The chief U.S. economist at Goldman Sachs believes it is not so easy to understand what the Fed will do because of the large hit the economy took with the last increase. The Fed will also take into account the unemployment rate. If the Fed keeps on raising the rate it will have a negative effect on the micro issues due to the fact that businesses and individuals will have a harder time with paying the higher interest rate.
Posted by Bryce Larkin at 4/07/2006 11:26:00 AM