The Bank Credit Analyst:
In Congressional testimony, Fed Chairman Bernanke spent most of his speech explaining what has happened in credit markets and why the Fed bailed out Bear Stearns. However, he also suggested that the worst for the economy is almost over.
2 comments:
Great graph. Its going to be quite a while until the Fed Cuts filter down to mortgage rates to directly effect consumption.
Conventional wisdom used to be that it was 12 to 18 months before rate changes really showed any effect on the economy. Unfortunately the location of the credit problems right at the major banks has kept a lot of these rate cuts from filtering in to lending rates on main street so far. But then again rates never got so high they were much of an impediment to economic activity.
The big thing I am watching for is a sign confidence has stopped eroding.
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