Credit Crisis & Real Estate Markets Report
Federal Reserve Board Slashes Fed Funds Rate
On December 16, 2008, the Federal Reserve slashed the target range for the federal funds rate to 0%-0.25%–a clear signal that Chairman Bernanke and other members of the Board will take all necessary steps to achieve economic recovery.
The press release announced that, in addition to the existing commitment by the Federal Reserve to purchase up to $500 billion of Fannie Mae and Freddie Mac mortgage backed securities and $100 billion of their debt obligations, the Fed will expand these purchase programs “as conditions warrant.” The Fed clearly understands that the key to economic recovery is restoring health to and confidence in the housing and mortgage markets.
Federal Reserve Press Release
Commentary by NAR’s Chief Economist Lawrence Yun
