Today, December 16, 2008, the Federal Reserve reduced the Funds Rate to near ZERO - how about that? Lower than the 1947 rate (.50%) and lower than after 9/11 (1.00%).
Amazing times we live in.
Japan did that and it didn't work but do not be fooled.
The Fed has much more up their sleeves and are using every trick in the book (and creating many new ones that I have discussed in previous blog entries). This is partly for show because it is a TARGET RATE only and short-term Treasuries have been trading at ".. .01 ..." - or close to zero for some time now. So the target rate now matches reality. They have finally caught up to the real world. The stock market liked it which just goes to show that nothing makes sense these days.
Where should the DOW JONES average be under normal circumstances? Based on average 6-7% annual rates of return and depending on what year you start, numbers like 12,800 or 13,500 or even 15,000 is where, under normal circumstances we should be today. The pendulum does swing both ways and often too far in each direction.
An Introduction
Hi. Welcome to BourGroup and my blog. Phil
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.