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Thread: Why is the Fed concentrating on the Housing/Mortgage market?

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    The latest effort by the Fed to pump up the money supply and to create jobs is targeting the real estate, home ownership, and mortgage market.

    The Fed will be buying mortgage backed bonds to move record mortgage rates even lower as a way to boost consumer demand for housing which should help increase sales of furniture, appliances, and create construction jobs.

    The move will also help bring some relief to the foreclosure crisis.

    But why just tackle mortgage rates?

    I think a lot of economic stimulus would be achieved if interest rates on credit cards were capped, and if the old usury limits on credit cards returned.

    I can't understand how our elected representatives allowed the banks to wipe out usury laws so that they could raise interest rates on cards to 30% or even higher?

    And 30% interest and even 18% interest makes no sense when deposits earn 1% or less at banks.

    If the government really wants to spur spending and increase consumer confidence, then cap interest rates and give consumers a chance to spend.

    Today, even if you have good credit, you could be hit with interest from the moment you charge a purchase with some credit cards. And if you carry a balance you are probably very familiar with interest rates of 25% or higher -- which years ago were illegal and only the mob's loansharks could charge that much.

    Today, the banks and the mob seem to be charging the same interest.
    Last edited by Alan Mendelson; 09-13-2012 at 08:24 PM.

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