d the short term rate by one-quarter of one percent. Still, this represented the first upward move in the interest rate in five years and resulted in a subsequent increase in long-term rates in the bond market. This was followed by another increase in short term rates in March, again an increase of one-quarter percent. This brought the rate at which banks borrow from each other to 3.5 percent (Wessel n.p.).
At the local level, banking activity has also recently increased. There has been increased pressure for banks to rewrite their lending rules in order for minorities and lower income consumers to borrow money for home loans. Through innovative programs, consumers are able to put down as little five percent (often in cash), and receive mortgages in the inner city, where institutions have traditionally been reluctant to lend. The goal is to increase the level of owner-occupied dwellings on the theory that such a move will help improve property values and encourage investment and development (Bacon, "Under Strong Pressure," A8).
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