Can the Fed pump in enough money to save the economy?
With all the recent decline in house sales, the US markets are starting to suffer. The Dow Jones has lost close to 1000 points in the last 45 days, and the world markets are not fairing much better. Despite the recent surge of monetary input by the Fed, the investors are still not seeing a rise in the daily markets. Instead, the Dow had another huge 3 digit sell off today. These sell offs are all stemming from the extreme risky sub-prime mortgage area, in which lenders lent out to much money and owners started foreclosing, leaving nothing but debt for the lenders. As the Fed looks to correct some of these problems, look for either a cut in interest rates or more money being pumped into the markets real soon.
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