Google Answers: Fed Funds Rate Raising vs. the Bond Market

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Q: Fed Funds Rate Raising vs. the Bond Market ( No Answer, 0 Comments )

Question

Subject: Fed Funds Rate Raising vs. the Bond Market
Category: Business and Money > Economics
Asked by: salevene-ga
List Price: $10.00

Posted: 06 Mar 2006 11:42 PST
Expires: 05 Apr 2006 12:42 PDT
Question ID: 704293

Please explain how the fed raising interest rates affects the bond
market?  Is it true that in theory, the fed raising interest rates
should drive long term rates higher (as investors will now move their
money into shorter maturities, now that they have been raised).  Also,
how does the fed raising interest rates cause the yield curve to
invert?  Why have long-term rates stayed so low?

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