Fed Leaves Key Lending Rate at 2%
The Federal Reserve decided that inflation concerns were more pressing that current financial instability and kept the 2.00% Federal Funds Rate unchanged.
Alt A Mortgages Coming Home to Roost
Alt A mortgages – high-risk mortgages offering low introductory interest rates requiring little in the way of proof of employment – are poised to add to the current U.S. housing woes. Like the subprime mortgages, Alt A loans were bundled into collateralized debt obligations – effectively hiding the true nature of the loans – and were then resold.
Crude Continues to Fall as Wall Street Braces for More Bad News
Crude fell to $91 a barrel on worries that the U.S. banking crisis could spill over into the global economy.
AIG Suffers Ratings Cut
American International Group Inc. fell by 38% to $2.97 and had its credit rating cut by both Standard & Poor’s and Moody’s. The ratings reduction will make it even more difficult for AIG to raise the funds it needs to remain solvent.
Loonie Continues to be Hammered as Crude Prices Fall
Forecasters suggest the Canadian dollar could fall to $1.12 – a drop of more than four cents – against the U.S. by the end of next year.
