That’s not the choice - The current problems weren’t caused by tight money (in fact, just the opposite) and adopting a loose money supply in the face of inflation and a weak dollar just trades one set of problems for another. The Fed’s job isn’t to save global equity investors or, probably any investors. Dumping money on this problem won’t solve it or even delay it much.
JoeyDVivre Wrote: ------------------------------------------------------- > That’s not the choice - > > The current problems weren’t caused by tight money > (in fact, just the opposite) and adopting a loose > money supply in the face of inflation and a weak > dollar just trades one set of problems for > another. The Fed’s job isn’t to save global > equity investors or, probably any investors. > Dumping money on this problem won’t solve it or > even delay it much. Do you really think that this is contained to equity markets? do you really think it’s just about housing? Do you really think it’s just about investing? Christ, you are on the CFA forum and you’re so narrow minded that all you can think of is saving people’s wealth?
No of course not, this a general recession we’re heading into, not just an equity market, or capital market panic. That being said, the Fed has more or less just admitted that things are very very bad out there and that we are entering a recession. These things sort of become a self-fullfilling phrophecy. Of course we all now more or less agree on this fact about entering a recession, so no big deal. Thing is, with the severity and timing of the cut, it looks a lot like a panic at best. Then there is the fact they will cut, again, next week! It looks like monetray policy by shotgun to me. Bill Poole for fed govenor (ya ya I know, governors can’t unilaterly set policy)!!!
CFA_Halifax Wrote: ------------------------------------------------------- > No of course not, this a general recession we’re > heading into, not just an equity market, or > capital market panic. That being said, the Fed has > more or less just admitted that things are very > very bad out there and that we are entering a > recession. These things sort of become a > self-fullfilling phrophecy. > > Of course we all now more or less agree on this > fact about entering a recession, so no big deal. > Thing is, with the severity and timing of the cut, > it looks a lot like a panic at best. Then there is > the fact they will cut, again, next week! It looks > like monetray policy by shotgun to me. > > Bill Poole for fed govenor (ya ya I know, > governors can’t unilaterly set policy)!!! Ok, that sounds much more realistic. I would agree that people could be overreacting. However, from knowing my market (structured finance) I know that things are pretty bad out there. When regular (non-siv, non sec-arb) ABCP conduits trade at 120 over LIBOR and can hardly place trades over 1 day, things are getting pretty bad.
JDV, I didn’t even think of that, have never used futures. Will look into it.
much better day for you down under Robb
hahaha Halifax, yes, takes away abit of the pressure, but for how long???
Robb Wrote: ------------------------------------------------------- > hahaha Halifax, yes, takes away abit of the > pressure, but for how long??? who knows, another 50 points next week? This all BS. I’m watching CNBC bitch about the ECB for not cutting harder. What bullcrap. Are your fellas at the Reverse Bank of Australia (do I have that right?) likely to follow suit??
No they wont, the word is that they might put off another rate rise but CPI rose 0.9% in Dec quarter, (annual rate up to 3 per cent the top of the RBA target). so consensus is they will leave things unchanged because of the state of the markets
Robb, they don’t worry about CPI much cuz if we go into a recession that will fix the pesky cpi.
true, but I don’t think they’ll be cutting rates for a while yet, we’re going pretty strong
spierce Wrote: ------------------------------------------------------- > JoeyDVivre Wrote: > -------------------------------------------------- > ----- > > That’s not the choice - > > > > The current problems weren’t caused by tight > money > > (in fact, just the opposite) and adopting a > loose > > money supply in the face of inflation and a > weak > > dollar just trades one set of problems for > > another. The Fed’s job isn’t to save global > > equity investors or, probably any investors. > > Dumping money on this problem won’t solve it or > > even delay it much. > > Do you really think that this is contained to > equity markets? do you really think it’s just > about housing? Do you really think it’s just > about investing? > > Christ, you are on the CFA forum and you’re so > narrow minded that all you can think of is saving > people’s wealth? Say what? All I can think of is saving people’s wealth? I’m sure I never said anything remotely resembling that and certainly not in the post you responded to. Read it again. The Fed’s emergency action was clearly in response to equity markets. While there was something like a 50% chance they would do it at their next meeting, global stock markets tanked and they had an emergency meeting. This is the first time in about 5 years (I think) that they have moved between meetings.
this is still interesting, there is a decent sell off on the Nikkei and the Yen is now strengthing Hang Seng has pulled back quite a bit too
And I think it was the first change of that magnitude 75 bps in something like 25 or 30 years.
Well, obviously HK rallied, but Europe is down quite sharply today, 3-4%. I heard someone on Bloomberg or CNBC talking about another 75 bps next week!!! Talk about overboard! If the fed were that wreckless, the dollar will absoluetly tank and I will find myself shopping stateside on the long weekend Feb
Dude, they have President’s day in Canaydia too?
bchadwick Wrote: ------------------------------------------------------- > Dude, they have President’s day in Canaydia too? Yeah we love Dubya so much up here bchad JK, we need to celebrate! No, actually I work for a Carribean company on a US holiday cycle. But actually that day in Feb is now a provincial holiday in Alberta and now as of this year Ontario, Family Day in both cases. As well, I think it is in some of the other small provinces.
“This is the first time in about 5 years (I think) that they have moved between meetings.” Very close, it’s actually the first time since September 2001. “And I think it was the first change of that magnitude 75 bps in something like 25 or 30 years.” First time since 1982, but in 1982 it was 100 bps.
October 84 they cut 75 bps.
Eddie Deezen Wrote: ------------------------------------------------------- > I checked the asian markets last night too before > I put my son to bed and they didn’t look too bad > (around 8 cst). With the market closed today I > didn’t really bother checking morning news and > just came in to work for a “few hours” to catch up > on things. Been here since 8am preparing for > tomorrow. So here’s the question, much of the trouble began not with Asian markets opening on Monday, and Bank of China’s subprime write-off, but actually when European markets opened. Since this Societe Generale stuff was all discovered on the weeekend and they began unwinding positions Monday, is that what caused the major sell off we saw after that? European markets were pretty weak again on Tuesday even after Fed rate cut, and then hammered hard again yesterday. Then, today, assumably after SG has unwound all the positions we hear the full story. Was this mini-market crash caused by this, if so, that’s pretty scary I have to say, as this guy los more than $7billion for SG when you consider the massive loses and margin calls booked in the wake of this? Thoughts?