Summary - Are Investors Ready for Higher Interest Rates?

The article, Are Investors Ready for Higher Interest Rates? discusses the difficult decisons that the Federal Reserve has regarding the appropriate time to raise interest rates. The Federal Reserve stated on September 23rd, "economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period." The Feds next meeting is from November 3-4 and it is unlikely that they will significantly change their stance on interest rates. Many investors believe that the Fed could be forced to raise interest rates as soon as early 2010. Others believe that the current low interest rates could last for months or potentially years. While the economy is still not very strong, it is gaining momentum with a better-than-expected 3rd quarter and the differences in opinions reflect the different beliefs of how soon the economy will fully recover. For the time being, the Feds are following the economy and other financial markets before any significant decisions are to be made.