The latest stimulus program for the purchase of mortgage bonds by the Federal Reserve, which will help the housing market gain a speedy recovery, was discussed during a meeting on Thursday.
Chairman of the Fed, Ben Bernanke said, "The Fed needs to drive down long-term borrowing rates because the economy isn't growing fast enough to reduce high unemployment," according to the Associated Press.
Members have now agreed that increasing the short-term rates to economic features in the upcoming years could be very effective to the market.
The Associated Press reported that after the meeting, the Fed said it would keep buying mortgage bonds until the job market showed substantial improvement. They also changed the bonds short-term interest rates to near zero, until 2015.
The Fed has already purchased more than $2 trillion in bonds since the 2008 financial crisis. The latest program seeks to spend $40 billion a month to buy mortgage bonds without an end date set," the Associated Press confirmed.
A majority at the meeting agreed that the more bonds they buy, the more support the economy will have. This will result in more borrowing and spending, driving growth in the economy.
According to the Associated Press, the minutes of the meeting stated, "Some participants suggested that, all else being equal, [mortgage bond] purchases could be preferable because they would more directly support the housing sector, which remains weak but has shown some signs of improvement of late."
Home mortgages have been below 4 percent this entire year, which shows healthy and positive signs for the market.
