Marc's Mortgage Matter's

As everyone knows, the Fed reduced its target for the federal funds rate to between zero and 0.25%, down from 1%, along with pledging to use "all available tools" to fight the current downturn. (Having a negative Fed Funds rate is highly unlikely, so they are left with flooding the market with liquidity as their tool going forward.) It said it was likely that rates would be kept at "exceptionally low levels" for some time to come. Bonds rallied, rates dropped, equities rallied on the news. The dollar worsened, but look for our currency to rally as other countries lower their rates.

Although the rate cut will help, remember that we still have an auto industry with problems, expected continued lay-offs (although not in mortgage banking!), and home builders are hurting. But the central bank's move to cut interest rates and pledge other efforts to unfreeze frozen credit markets should translate into significantly lower interest rates for consumers. Commercial banks responded immediately to the Fed announcement by cutting their prime rates. Great time to review your present mortgage situation, and call me with any questions regarding this WOW drop!

Dear Sirs,
In view of current developments in the banking market, if one of my checks is returned marked “insufficient funds”, does that refer to me? Or to you?
Yours Faithfully,
Signed - Marc