With the next Federal Reserve meeting, on March 21, just down the road, it's time to take stock of what has happened and is happening to the economy, in anticipation of the next interest rate action. In a widely expected move, the Fed raised short-term interest rates by a quarter point last month in an effort to slow the seemingly unstoppable US economy and ensure prices for goods and services do not begin to creep higher. It also shot a warning over Wall Street's bow that it will raise rates again if the economic celebration now in record territory does not die down a bit. It was tough love for an economy just celebrating its record 107th month of uninterrupted expansion.
Unemployment is at a generation low and continuously declining.
Prices for goods and services are stable if not falling. Record stock market gains have more people participating in the market than ever. Rising real estate values in 1999 have given Americans more paper wealth than ever before. The problem is not what is going on now. It is what could potentially happen in the future that Greenspan's Fed is protecting us from.