The local  Star-Advertiser  today carried an article that headlined: Gold hits record $5,311 as dollar falls ahead of Fed decision First of all, the  Federal Reserve today held interest rates steady for the first time since July .  Fed Chair Jerome Powell ( will stay on as governor until the end of 2028 ) said that economic activity and business fixed investment have been expanding at a solid pace, while consumer spending has been resilient.   However, even though the housing market continues to show weakness, it has begun to show signs of recent life.   Mortgage rates have been at a three-year low. Yet, 6% for 30-year fixed is not exactly low. 15-year fixed is around 5%, also not so good. On the other hand, it was 7% last year. A good low interest rate for a 30-year fixed mortgage is anything below 4%. In January 2021, a record low of 2.65% was reached. This rate hovered between 3% and 4% in the 2010s. However, and this surprising to me, the hist...

This could well be my most humdrum posting ever.  Today, I will try to simplify all you need to know about the Federal Reserve System.  Why? The Federal Reserve today cut the interest rate for the first time this year.   President Trump's political pressure and weakening labor market were reasons.   The U.S. lost jobs in June. So far this year, the economy has added 598,000 jobs, compared with 1.4 million for the first eight months of 2024. The unemployment rate also ticked higher last month to 4.3%, a level not seen since September 2017 outside of the Covid-19 pandemic. The cut was from 4.25% to 4%.  I did not know there were so many members on the Committee, but the vote was 11-1.  The dissenter was newly appointed governor ( members are called governors ) Stephen Miran.  He wanted a reduction of half a percent.  Trump has two others on the panel, and they went for the quarter point.   This lower rate should help businesses hire, ...