Sunday, September 19, 2010

Fed Is Expected to Discuss More Ways to Revive Economy

The Fed's meeting on Tuesday will discuss major issues of how to revive the economy. They are debating using taxes and the purchase of treasury bonds to help.
Last month the central bank voted to use money from their portfolio of mortgage backed securities to buy long term treasury debt. They are trying to put downward pressure on the interest rate. The fed has already had a lot of influence over the short term rate *which is nearly zero. These new actions will lower the long term rate.
The Fed is most worried about our economy falling into inflation.

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