Avion Gold Corp AVGCF

RE: RE: Also worth noting IMHO

[Bobwins]

The FED cannot afford for housing interest rates to go up several points.  This was an unexpected move designed to throw the markets off balance a bit but they CANNOT raise interest rates dramatically.  The economy is too fragile and they know it.

The discount rate is relatively low on the totem pole of effective ways to hike rates.  First, many banks don't borrow at the discount window.  Second, the banks are getting free money from their depositors so what do they care if the discount rate goes up .25%?  

The market will likely overreact, which is what the FED intended but this is not a sign that interest rates are headed up by many points.  The Banks have such a huge net interest margin that this is not going to stop them from making loans if they want to.  In fact, they aren't making loans anyway so the discount rate is not going to impact interest rates nor loan volume.