Tuesday was an important day for the markets. Bernanke and company lowered the Fed Funds rate 75 basis points to 3.50%. The largest move since 1984! There are growing concerns that the weakening US economy may spread to the international markets. Watching CNBC, there is talk about the small and large “R word.” The small being a national recession and large representing a possible global slowdown.

After five consecutive sessions of negative trading, the Dow fell more than 300 points in early trading only to recover and close up 299.98 points! A gain of 2.50% for the day!

As I search for some guidance amid all this volatility , I find Douglas Bodenwieser with Comprehensive Financial Group. He offers this thought… “As for the recent decline in the stock market, consider this a great buying opportunity, whether you have money in you 401(k) money market account, or have been put off by high stock prices. Think about a systematic investment strategy. Contribute as much as you are able every month, no matter the market condition, and let the “time value of money” be your friend.”

Currently, conforming interest rates (loans $417,000 and less) are quietly falling to record lows that we have not seen since 2003! This means 30 year fixed rates in the low fives! Another refinance boom just around the corner? Many say yes.

This will undoubtedly help some folks facing ARM resets this year to help fight off default. Home value is the bigger picture here and without equity, homeowners may not have any viable options to take advantage of these low interest rates.

Rich Johnson at Windermere Exclusive Properties and HotonSanDiego.com real estate blog contributing editor states… “The Fed’s rate cuts have helped to spur consumer interest and activity in our local Real Estate markets. It’s not so much that it’s been reflected in lower mortgage rates, but more so that these cuts have helped to bolster the perception that now really is a great time to buy. With inventory levels declining slightly, home prices down significantly in some areas, combined with still historically low interest rates, we’re finally seeing people getting off the fence and buying again.”

The good news? With inventory levels slowly returning to normal, low interest rates, and a healthy job market we could be seeing a bottom in housing this year.