Interest rates

Interest rate affect the whole economy. In particular is affect how much it costs to repay the interest on a mortgage agreement.

Interest rates have recently been at historical low levels. Rates were lowered significantly after the bursting of the dotcom bubble in 2000 and were again lowered after the 9/11 terrorist attacks on the World Trade Center. Alan Greenspan is credited with lowering interest rates at the first sign of a slow down in the US economy; this has become known as the "Greenspan Put". The negative effect of the "Greenspan Put" was to prevent the bubble from deflating thus allowing it to grow even larger to the point were it will pop (just like a balloon).

See also:-

Interest Rates