"NEW YORK (AP) - The Federal Reserve announced a $1.2 trillion plan three months ago designed to push down mortgage rates and breathe life into the housing market.
But this and other big government spending programs are turning out to have the opposite effect. Rates for mortgages and U.S. Treasury debt are now marching higher as nervous bond investors fret about a resurgence of inflation."
SURPRISE!
You have to wonder also what the chilling effect is on GM bondholders getting the shaft is having on financial markets belief in the sanctity of contract law. Essentially the government is saying that "for the good of the country we can come in late in the game and change the rules on which everyone was playing...retroactively", and in the case of GM, not for sound economic reasons, but to please a voting constituency (special interest group).
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