Divided Government=Lower Interest Rates

Nov 13, 2006

The democrats sweep of congress has not only put a damper on President Bush, but also on interest rates. With gridlock expected in the government for the next two years, spending will likely be lower, which is a positive for the bond market. The slowing economy will also encourage the Federal Reserve to maintain a neutral stance on interest rates in the near term. Indeed, the Fed may even decide to lower rates in 2007. All told, the election was good news for potential home buyers! Now, if we can only solve our problems in Iraq...

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