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FED Cuts rates by 75 basis points

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FED Cuts rates by 75 basis points

Postby mkwin » Tue 22 Jan 2008, 10:13:58

Emergency FED cut.
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Re: FED Cuts rates by 75 basis points

Postby rostov » Tue 22 Jan 2008, 10:20:59

Holy cow! What a great chance to re-enter the shorts!!
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Re: FED Cuts rates by 75 basis points

Postby Bas » Tue 22 Jan 2008, 10:23:04

whaaaaaat?

oh yes I see on CNBC
Last edited by Bas on Tue 22 Jan 2008, 10:25:08, edited 1 time in total.
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Re: FED Cuts rates by 75 basis points

Postby Niagara » Tue 22 Jan 2008, 10:24:11

"Where the !@#$% is all this water coming from?"


-Captian, RMS Titanic
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Re: FED Cuts rates by 75 basis points

Postby Bas » Tue 22 Jan 2008, 10:29:10

I wonder where that will put the dollar in the next few weeks though. And think about inflation.... :?
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Re: FED Cuts rates by 75 basis points

Postby IslandCrow » Tue 22 Jan 2008, 10:31:56

BBC link$this->bbcode_second_pass_quote('', 'T')he Federal Reserve has cut US interest rates to 3.5%, a shock three-quarters of a percentage point reduction.


I hope that this is enough of a cut for the bank to cut my mortgage rate.
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Re: FED Cuts rates by 75 basis points

Postby mkwin » Tue 22 Jan 2008, 10:34:30

$this->bbcode_second_pass_quote('rostov', 'H')oly cow! What a great chance to re-enter the shorts!!


It is going to be a very interesting open in the US today.
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Re: FED Cuts rates by 75 basis points

Postby Niagara » Tue 22 Jan 2008, 10:35:18

It's not working. There was a brief rally after the announcement, most likely a knee-jerk reaction.

But stock prices are now sinking again pre-market. The street wanted more.

Jim Cramer was just on CNBC, his take is "too little too late"
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Re: FED Cuts rates by 75 basis points

Postby benzoil » Tue 22 Jan 2008, 10:35:32

$this->bbcode_second_pass_quote('Bas', 'A')nd think about inflation.... :?


Someone should. It's obvious that the Fed isn't thinking about it. We're going to get hammered.

Sigh. I told myself, "Self, Gold is too expensive at $605. Buy when it drops back down to $550." It never quite hit $550 again and now the train has left the Bullion Street station. Best wishes to those who's timing was better than mine!
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Re: FED Cuts rates by 75 basis points

Postby mkwin » Tue 22 Jan 2008, 10:46:25

BB is more concerned with deflation that inflation. There are far too many worrying parallels with the 1929 US and 1990 Japanese crashes.

It could be too late though, the Japanese cut rates from 6% to effectively 0% and it still did not stop a massive asset crash causing a deflationary spiral that is still hampering them today.
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Re: FED Cuts rates by 75 basis points

Postby mekrob » Tue 22 Jan 2008, 10:48:13

Oh, God this is going to be fun. It just sucks that I have class pretty much all day, save 30 minutes for lunch and I have a lab to finish. I'll still find time to see how badly the economy is fucked.
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Re: FED Cuts rates by 75 basis points

Postby big_rc » Tue 22 Jan 2008, 10:48:43

$this->bbcode_second_pass_quote('benzoil', '')$this->bbcode_second_pass_quote('Bas', 'A')nd think about inflation.... :?


Someone should. It's obvious that the Fed isn't thinking about it. We're going to get hammered.

Sigh. I told myself, "Self, Gold is too expensive at $605. Buy when it drops back down to $550." It never quite hit $550 again and now the train has left the Bullion Street station. Best wishes to those who's timing was better than mine!


Benzoil. Don't worry. The train might have left the station but it still not that far away. Since Ben is cutting rates like a crazy man, there is still a whole lot of room for gold to run.
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Re: FED Cuts rates by 75 basis points

Postby VinceG » Tue 22 Jan 2008, 10:51:22

If the FED hadn't cut interest rates by .75%, everyone here would have cried: "OMG look at what is happening at the stock markets today, we are witnessing economic meltdown as we speak, run for the hills!"

But now that the FED DOES takes some actions to stimulate the American economy and cuts the rates, everyone here is crying: "OMG look at what is happening at the stock market today, we are witnessing economic meltdown as we speak, it is just a panick move that the FED is cutting rates by .75%, the world is screwed anyways, run for the hills"

Some people need to take of their doom-and-gloom glasses...
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Re: FED Cuts rates by 75 basis points

Postby Heineken » Tue 22 Jan 2008, 10:59:36

$this->bbcode_second_pass_quote('mkwin', 'B')B is more concerned with deflation that inflation. There are far too many worrying parallels with the 1929 US and 1990 Japanese crashes.

It could be too late though, the Japanese cut rates from 6% to effectively 0% and it still did not stop a massive asset crash causing a deflationary spiral that is still hampering them today.


Yes, and the Japanese did not have bazillions in government debt that had to be propped up by foreign investors.

The US is another story, as we know.

Who wants to own notes paying zero percent??
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Re: FED Cuts rates by 75 basis points

Postby firestarter » Tue 22 Jan 2008, 11:00:13

$this->bbcode_second_pass_quote('VinceG', 'I')f the FED hadn't cut interest rates by .75%, everyone here would have cried: "OMG look at what is happening at the stock markets today, we are witnessing economic meltdown as we speak, run for the hills!"

But now that the FED DOES takes some actions to stimulate the American economy and cuts the rates, everyone here is crying: "OMG look at what is happening at the stock market today, we are witnessing economic meltdown as we speak, it is just a panick move that the FED is cutting rates by .75%, the world is screwed anyways, run for the hills"

Some people need to take of their doom-and-gloom glasses...





The Fed FOLLOWS, the debt markets LEAD. This will do little to change the insolvency part of the equation.

The catalyst to this panic is the monoline DISASTER. The 75bp cut today does absolutely nothing to correct it. The smart money knows that and they aren't buying the impotent Fed's move.

The Fed is merely the market's bitch. They're irrelevant at this point. Just ask the BOJ if you don't believe me.
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Re: FED Cuts rates by 75 basis points

Postby Ferretlover » Tue 22 Jan 2008, 11:17:33

Jeez, now they are talking about another 50 point cut at the end of the month if not sooner....
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Re: FED Cuts rates by 75 basis points

Postby VinceG » Tue 22 Jan 2008, 11:27:12

Doesn't lower interest rates equal higher consumer spendings equal higher inflation equal an even more devaluated dollar?
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Re: FED Cuts rates by 75 basis points

Postby emersonbiggins » Tue 22 Jan 2008, 11:27:16

$this->bbcode_second_pass_quote('VinceG', '
')Some people need to take of their doom-and-gloom glasses...


So, what optimism can you wring from the current situation, VinceG?

Looks pretty bleak to me, and any move the FED makes now will likely be futile in an attempt to mitigate the circumstances.
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Re: FED Cuts rates by 75 basis points

Postby Bas » Tue 22 Jan 2008, 11:28:01

$this->bbcode_second_pass_quote('mkwin', 'B')B is more concerned with deflation that inflation. There are far too many worrying parallels with the 1929 US and 1990 Japanese crashes.

It could be too late though, the Japanese cut rates from 6% to effectively 0% and it still did not stop a massive asset crash causing a deflationary spiral that is still hampering them today.


Well, assets are going to plummet anyhow, meanwhile the dollar will fall and food, raw materials, all sorts of imported consumer goods and energy prices will go up. Situation is quite different from Japan with it's low consumption quote and unwillingness to borrow and 1929 when they restricted the money supply for far too long I believe?

On the deflation side though, there is the threat of plummeting commodities, but I wonder how long that could last...

Anyway, I don't know everything about moneymarket economics, so you might be able to convince me of the deflation case but I'm afraid we'd have to dive deep into it...
Last edited by Bas on Tue 22 Jan 2008, 11:32:30, edited 1 time in total.
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Re: FED Cuts rates by 75 basis points

Postby emersonbiggins » Tue 22 Jan 2008, 11:30:19

Ain't that purdy? :twisted:

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