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Fed Holds Steady

Fed Holds Steady

The Federal Reserve made news by making no news, really. They announced no changes to their financial policies. So what does that mean for you and your investments?

Interest rates will remain where they are at. The Fed will keep buying bonds. And Houston financial analyst Richard Rosso says this will hurt your chances of growing your money.

“If you’re a conservative investor, you’re sort of screwed. What are you earning on that right now? Zero,” Rosso told KTRH.

Rosso says the Fed's decision is causing you to make hard decisions of your own.

“They are forcing conservative investments out. People are either taking risk or sitting on the sidelines,” Rosso said.

But Rosso doesn’t think you should go after bigger returns when the risk is too high.

“The worst thing you can possibly do is chase yield. You might lose more of the principal that you put in,” he explained. “Don’t risk more than you can lose. If you have to sit in cash and earn nothing until things change, that’s a perfect strategy.”

So how long will it be before conservative investors will start seeing bigger returns on their investment? Rosso says it could be until sometime in 2016.

 

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