Tomorrow: - 50 bps rate cut (coordinated with other CB’s… again) - guarantee CP transactions; become a guaranteed counterparty clearer for CDS - suspend mark to market accounting - propose stimulus package to the public - inject capital into the big banks - temporary moratorium on foreclosures while distressed mortgages are re-worked If they announced all of those things - the old Shock and Awe - what would the market do? Because if those can’t inspire confidence, I don’t know what can.
Yawn and drop more I think. They’ve done most of those and suspending foreclosures would be illegal
They suspended foreclosures during the Great Depression (if I’m not mistaken). They told everyone to stay in their house and pay for it when they can. That’s the story I got from grandpa before he croaketh.
The US imposed a moratorium on foreclosures in the great depression.
Besides the above, what else would shock the system? Putting the moral issue aside, I’m thinking of what they can possibly do. Because if we can’t think of it, they sure as hell can’t…
Ban all trading of stocks and ban selling.
Deploy the National Guard at the shopping mall and force the U.S. consumer back on track. Spend Dammit! SPEND!