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The Fed's Latest Rate Cut: The Song Remains the Same

 Mar 19, 2008 02:25 PM UTC
Symbol Sentiment Start Return Closed
INDU Negative 03/19/08 +13.44% --
SPX Negative 03/19/08 +16.90% --

3/19 - "...my opinion on the rate cuts hasn’t changed since my first commentary on the matter in September...Ultimately this crisis about a bursting credit bubble, poor risk management and bad investment decisions, not high interest rates. Cutting rates may inject confidence, make people feel better or ease pains but it doesn’t solve the core problem...With respect to mortgage relief, the market has effectively ignored the previous rate cuts with respect to lowering mortgage rates."

"The Fed is ready to debase the dollar and cut interest rates all the way down to 1%, in order to hasten our economy’s journey along the path to having a ‘lost decade’ like Japan."

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4 Related Views

N/A
-37.74%
 risk: moderate
Is the Fed Confused? Or Just Being Confusing?
3/18 - "When is the last time we had two dissenters on a Fed rate cut/increase? Don't get me wrong. I was pulling for a sizable rate cut. But this Fed inability/unwillingness to get ahead of markets on rates is almost as irritating as these make-everyone-happy compromises. Damn academics."

N/A
+0.00%
 risk: moderate
How Risky are the Fed's Actions?
3/19 - "As for the near-zero interest rates, well, we're still 200bp away from zero, and I don't think anybody anticipates that rates will stay this low for years, like they did in Japan." "So I think all these worries about moral hazard and decades-long economic malaise are overblown. If there is a decades-long economic malaise in the U.S., it will be despite the Fed's best efforts, not bec...

N/A
-6.74%
 risk: moderate
What the Fed Rate Cut Means to You
3/18 - "If you invest in stocks, you may be feeling a bit of relief at the 420 point rise in the Dow today. But if you have a balance on your credit card, don't hold your breath waiting for that rate to fall. Meanwhile, you may sleep more fitfully tonight as the rate cuts weaken the dollar and raise your cost of living." "Some credit cards have gone down, but some cards have barely budged. F...

N/A
+0.00%
Only Shocking Fed Action Will Prevent True Catastrophe
3/18 - "You can have some pretty catastrophic things happen when people start to panic - as far as what happens with money and how all sorts of things can seize up at once. It's really a psychological problem - a spiral of negativity and panic that feeds on itself...We are on the brink. We haven't seen such potentially perilous economic times in a long, long time...Has the Fed been too slow? Ye...


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