Cue the Iraqi information minister and the line about the subprime mess being "contained", and that the overall health of the economy is "immune" to the fallout.
$this->bbcode_second_pass_quote('', 'F')ed to Cut Rates Again Before January, History Shows
By Elizabeth Stanton
Sept. 24 (Bloomberg) -- Government bond traders, who predicted six of the last seven recessions, say the Federal Reserve will lower interest rates again before the end of the year as the economy comes to a standstill.
Since the Fed last week lopped half a percentage point off the central bank's target for overnight lending between banks -- the first orchestrated decline in so-called federal funds since 2003 -- traders have pushed the yield on Treasury two-year notes to almost three quarters of a point below the designated 4.75 percent funds rate. In the three previous occasions during the past 20 years when that has happened, policy makers have cut borrowing costs.
"The U.S. economy needs to grow at 2.5 to 3 percent or else it stalls,'' said Bill Gross, manager of the $104.4 billion Total Return Fund, the world's biggest bond fund. "Historically every time we get close to stall speed the Fed lowers short rates."
...
The economy's mortgage-related problems are "not behind us today and they're not going to be behind us for a long time to come,'' Hunt said. "This rate reduction was first of what we think will be quite a few over the next couple of years."
...
Bloomberg
PeakOil is You
Fed to cut rates AGAIN before Jan 2008
Fed to cut rates AGAIN before Jan 2008
by emersonbiggins » Mon 24 Sep 2007, 14:29:29
"It's called the American Dream because you'd have to be asleep to believe it."
George Carlin
George Carlin
-
emersonbiggins - Expert
- Posts: 5150
- Joined: Sun 10 Jul 2005, 03:00:00
- Location: Dallas
Re: Fed to cut rates AGAIN before Jan 2008
by Plantagenet » Mon 24 Sep 2007, 15:00:57
Another US interest rate cut will drive the dollar down even further. 
-
Plantagenet - Expert
- Posts: 26765
- Joined: Mon 09 Apr 2007, 03:00:00
- Location: Alaska (its much bigger than Texas).
Re: Fed to cut rates AGAIN before Jan 2008
by roccman » Mon 24 Sep 2007, 15:36:11
$this->bbcode_second_pass_quote('Plantagenet', 'A')nother US interest rate cut will drive the dollar down even further.
Of the nearly 2000 post you made...this is the only one i agree with.
Here's another truth...
as oil goes up the dollar will go down.
and one last one for old time sakes:
as the dollar goes down and oil goes up...gold also goes up...
Red rover red rover send PA right over
"There must be a bogeyman; there always is, and it cannot be something as esoteric as "resource depletion." You can't go to war with that." Emersonbiggins
-
roccman - Light Sweet Crude
- Posts: 4065
- Joined: Fri 27 Apr 2007, 03:00:00
- Location: The Great Sonoran Desert
Re: Fed to cut rates AGAIN before Jan 2008
by SinisterBlueCat » Mon 24 Sep 2007, 15:44:04
i think they will do it as early as their oct 31 meeting...what better day to scare the hell out of people than halloween
-
SinisterBlueCat - Tar Sands
- Posts: 885
- Joined: Tue 06 Sep 2005, 03:00:00
Re: Fed to cut rates AGAIN before Jan 2008
by Tyler_JC » Mon 24 Sep 2007, 15:57:36
$this->bbcode_second_pass_quote('roccman', '')$this->bbcode_second_pass_quote('Plantagenet', 'A')nother US interest rate cut will drive the dollar down even further.
Of the nearly 2000 post you made...this is the only one i agree with.
Here's another truth...
as oil goes up the dollar will go down.
and one last one for old time sakes:
as the dollar goes down and oil goes up...gold also goes up...
Red rover red rover send PA right over
I think you might be putting the chart before the horse on this one.
A drop in the dollar leads to an increase in the price of oil, not the other way around.
If Iran suddenly stopped exporting oil (a supply shock), oil prices would increase and demand for dollars would increase. Non-Americans would have to pay more in dollar terms for oil and those dollars would cost more.
Independent of oil supply/demand, a drop in the value of the US Dollar leads to an increase in oil prices in order to maintain the same global value for the commodity.
But an increase in the price of oil as measured in dollars by itself would not lead to a decrease in demand for US dollars in the global currency markets. As I mentioned earlier, the dollar might actually strengthen because foreign countries would need to purchase more dollars in order to purchase the same amount of oil.
The only possible cause and effect between High Oil---->Low Dollar is if the current account deficit of the USA increases dramatically as a result of high prices for imported oil, resulting in more dollars on the global marketplace. This is an important factor but it doesn't account for the massive losses in the Dollar Index over the past half decade or so.
Last edited by Tyler_JC on Mon 24 Sep 2007, 22:34:25, edited 1 time in total.
"www.peakoil.com is the Myspace of the Apocalypse."
- Tyler_JC
- Expert
- Posts: 5438
- Joined: Sat 25 Sep 2004, 03:00:00
- Location: Boston, MA
