Will Fed Chairman Bernanke base his interest-rate decision on 4% GDP growth in the moment quarter, essentially looking through the rear view reflect, or on virtually every other info point that suggests the economy is slowing down?

Bernanke deserves plaudits for his handling of the economy, particularly halting rate increases knowing changes in Fed policy take date to affect the economy. Something Greenspan might not have done.

Bernanke’s most crucial sign on where the economy could be is the 10-year bond that has crashed from 5.2% in late 2006 to 4.47% nowadays. However, Ethan Allen Interiors Inc (NYSE: ETH) CEO Kathwari said yesterday at Goldman’s retailer conference “our retail written sales on a comparable store basis were up modestly in June and July. that positive trend has continued in August.” that is

by no means a glowing review of the economy, but neither is it a sign of an economy in deep despair.

Meanwhile, the pending domestic sales index crashed 12.2% in July versus June, dropping to the lowest level since September 2001. Since the index tracks existing-home contract signings, not final sales, it is considered a main indicator and suggests a big drop in domestic sales in August or September.

From all the evidence, the Fed should start dropping rates. With the drop in the reduction having some calming effect, look for the Fed to start with a 25 basis point basis cut followed by two increasingly to finish up the year.

Original post by Eric Buscemi

foreclosure auto insurance student loans credit report law debt consolidation banking stocks payday loans income taxes