Are Unemployment Rates Good or Bad for Interest Rates?

Last Friday, November 3, 2006, the Department of Labor released the new unemployment figures which fell to 4.4%. This number represents an increase in jobs in the nation overall. The economy is doing better and better each day. In fact the Unemployment rate was almost 6% in 2004 and has steadily declined (more people going to work) each year. Now here is the interesting part of the story. The current interest rates are artificially low to encourage people back into the housing market. The Fed is concerned that with more people now working more homes will be bought so they will naturally try to fiddle with the interest rates. That is exactly what we saw happen on Friday. Rates were all over the map. So if you are a buyer now is the time to get into the market before rates go higher. Unemployment is a GOOD thing, just remember that with all market economies, the more people that want a particular item, in this case interest rates, the market will drive the price of that "thing" that they want upwards. This is a classic market force at work.