Short-term interest rates inched lower in the bond market Monday after a Federal Reserve official reiterated that record-low interest rates are still needed to help the economy.

Rates rose and bond prices fell as Federal Reserve Bank of San Francisco president Janet Yellen became the latest Fed official to stress that the central bank isn’t in any rush to boost borrowing costs for millions of Americans. The remarks come after the Fed took a surprise step Thursday and bumped up the discount rate, the interest banks pay for emergency loans. . . . read more

The Federal Reserve seems likely to keep interest rates at record lows for several more months after news Friday that consumer prices excluding food and energy fell in January.

It was the first time such prices have fallen in any month since 1982.

The benign report on consumer inflation sent a positive signal to investors and borrowers. It suggested that short-term rates can remain low to strengthen the economic recovery without triggering inflation . . . read more

Focused on keeping the recovery going and driving down double-digit unemployment, the Federal Reserve is poised to leave interest rates at a record low.

Fed Chairman Ben Bernanke and his colleagues resumed a two-day meeting on Dec. 16. At the end of the meeting, the Fed struck an upbeat note about the progress the economy is making. But they also cautioned that now is not the time to be complacent against risks.

Signs are growing that the economy is on the mend. Consumers and businesses are spending again. The housing market is stabilizing. Manufacturing is growing. And layoffs are moderating . . . read more

President Obama made a solid choice this week to reappoint current Federal Reserve Chairman Ben Bernanke to a second four-year term. His initial four-year appointment by then-President Bush expires on January 31, 2010.

The President of the United States is typically viewed as the most powerful person on the planet. Surprisingly, the Chair of the Federal Reserve is typically viewed by many as the second most powerful.

Indeed, I would make the case that the Fed Chair, through his or her influence upon short-term interest rates has perhaps more influence on our day-to-day lives than does the President.

Without a doubt, the recession that began in December 2007 has shaken up our perspective on the economy. Beyond the pressing issues facing Americans who have lost their jobs or their homes, the outcome of this recession centers on changes in the monetary and fiscal policies that underlie our economy.

What do these factors mean to you?

One more month…one more exceedingly painful U.S. employment report

We have now had seven consecutive terrible job reports since the American consumer was told “the sky was falling” last September 18 by Federal Reserve Chair Ben Bernanke and then-U.S. Treasury Secretary Paulson. It was on that day that this dynamic duo emotionally and very publicly asked the U.S. Congress for $700,000,000,000 to fix financial markets.

That request, and the up-and-down discussion within the U.S. Congress during the following week, simply scared the American consumer to death. The consumer stopped spending…companies of all sizes adopted a “shoot first, ask questions later” approach to layoffs…and the economy dropped quickly. The rest, as they say, is history.

The struggling American economy, officially in recession since December 2007, hopes to establish a foundation for renewed growth before the end of the year. A combination of home price stabilization, a bit of optimism from the national media, and the impact of massive amounts of stimulus should help establish just such a foundation.