No More Fed Rate Cuts

[FM]

that's it.

we've hit rock bottom.

the Fed is done. "0%" rates now.

if things don't improve in the next couple of years, hello Japan here we come.

But if you need a loan, man those rates are gonna be dirt cheap

[runningman]

Re: No More Fed Rate Cuts

won't this just turn into another super bubble??

Will commodities lead the way in pulling us out of this mess??

What happens if this doesn't work?

Jim Rogers has it right. We should have let AIG fail. What a horrible investment by the US. It is kind of humorous in a way that the people that have fucked us in the ass we are now asking them to fix it. Which could be the stupidest thing I have ever heard. We won't see how bad it is until the Fed raises interest rates. Then the real shit will hit the fan.

[youtube]http://www.youtube.com/watch?v=P6nkHbbj8fA&NR=1[/youtube]

[day_for_night]

Re: No More Fed Rate Cuts

won't this just turn into another super bubble??

Will commodities lead the way in pulling us out of this mess??

What happens if this doesn't work?

Jim Rogers has it right. We should have let AIG fail. What a horrible investment by the US. It is kind of humorous in a way that the people that have fucked us in the ass we are now asking them to fix it. Which could be the stupidest thing I have ever heard. We won't see how bad it is until the Fed raises interest rates. Then the real shit will hit the fan.

[youtube]P6nkHbbj8fA[/youtube]

you don't have the slightest CLUE what you're talking about. please stop...

[Miroslav]

Re: No More Fed Rate Cuts

won't this just turn into another super bubble??

We won't see how bad it is until the Fed raises interest rates. Then the real shit will hit the fan.

Please explain the logic of why you are first concerned about shit hitting the fan due to low rates and then you are concerned about shit hitting the fan due to high rates - in the same post.

[runningman]

Re: No More Fed Rate Cuts

I was asking a question hence the ?? mark.. A statement ends in a ...

If you guys spent more time answering my questions rather then nit picking my statements maybe we could collectively come up with some sort of direction.

DFN you are just pissed because I talked back to you in the Shiva post.

[Miroslav]

Re: No More Fed Rate Cuts

I was asking a question hence the ?? mark.. A statement ends in a ...

If you guys spent more time answering my questions rather then nit picking my statements maybe we could collectively come up with some sort of direction.

Ok. In that case, I will answer your question.

No, this rate cut will probably not result in another super bubble. The reason is because it occurs during a time in which spending and investment is significantly slowed - and slowing even further. During recessionary times such as these, governments typically adopt these kinds of aggressive and expansionary monitary and fiscal policies in order to (1) reduce the burdens on consumers and businesses, thus encouraging them to spend, and (2) to compensate for the lack of private spending through government spending - creating jobs, investing in infrastructure, etc. Had they cut rates like this during healthy and expansionary economic times, then yes it would very likely stimulate the creation of another bubble. In fact, it is broadely argued that the central bank contributed to the housing bubble by leaving rates too low during much of the last decade.

Even with this rate cut, things are so bad that consumers and businesses will still not resume spending anywhere near the levels that they did in the recent past. And the reason is simple: losses have still not been sufficiently realized by businesses and consumers, and no one really trusts the valuations of many assets right now. This rate cut should help reduce the overall severity and duration of the recession, but my guess is that we're still in for at least a 12-month downturn.

[day_for_night]

Re: No More Fed Rate Cuts

I was asking a question hence the ?? mark.. A statement ends in a ...

If you guys spent more time answering my questions rather then nit picking my statements maybe we could collectively come up with some sort of direction.

DFN you are just pissed because I talked back to you in the Shiva post.

nope, not at all. i think most of your posts in here are uninformed, reactionary crap. just saying so.

and i wasnt refering to your questions, i was refering to your statement at the end. had AIG failed it would have meant so many uninsured people and businesses that it would have been an absolute legal nightmare during the transition to different insurance companies.