Fed Cuts Interest Rates; Too Little, Too Late?

Today the fed announced a key interest rate cut of ¾'s of a percent, but is it too little, too late?

In a hastily arranged teleconference, the feds approved by an 8-1 margin an interest rate cut before their regularly scheduled meeting next week. It was an effort to calm the world wide commotion surrounding the expected recession the U.S. is about to experience, but investors took the news in a different light, with the Dow plunging 400 points this morning before recouping 250 points of that back in mid day trading.

While this effort to calm the economy, along with a projected tax return bonus check ( $800 for individuals, $1600 for married couples/ families is is what is currently being thrown around) is expected to help somewhat, it may be too late the the U.S. to avoid this recession. Which is why the Feds had this "emergency meeting" in the first place.

How this will affect your mortgage:

If you have a 30 year fixed rate mortgage, probably not much, they are tied to longer term bonds yields that look more into how the outlook for the economy happens to appear, which as you probably already know, doesn't look all that appealing.

How this will affect your loans:

If you are looking for short term loans of refinancing, this might be a good time to do it (or wait another week, wear the feds are expected to drop the rate some more). Percentage rates not are better than they have been in years, and if it's a short term (12 month, up to 5 years) then now would be the best time for awhile.

What, me Personally?:

While I'm not sure how much money I currently have for a large new purchase, I have been looking into larger flat screen TV's, and also newer used cars, and both of these could possibly fall under the newer rates if financed.

A Personal Recommendation:

While it is obviously not my place to tell you how to spend your money, I do have a recommendation. Do you have a little bit of credit card debt, or a couple bills that might be a little behind? Now would be the time to hold tight and pay those down. Sure, new expensive things always make me feel a little better, but only for a short while, and after that fades, I still have to go look at my Credit card statements and feel guilty about not paying those off yet. So now, maybe more than ever, would be the time to get that taken care of.