LEARNING CORNER

SOFT LANDING

Do you all understand the reason behind FED increased interest rate since Oct 2004 until Jul 2006? One of the reason is the economy was growing at strong rate and FED try to make a soft landing by raising interest rate to slow the economy down and prevent it fall into recession and also avoid a high inflation. This term is called SOFT LANDING.

Mr. Greenspan was known as a master at the soft landing.

How about the time when FED keep cutting the rate since mid of 2007? Is it the sign of recession? :)