There are some analysts who expect the Fed to cut interest rates another quarter point to 2%. I, for one, am concerned that this may be a bad decision. Every time the Fed cuts rates, the dollar becomes weaker on the world market. This will push the price of commodities (including oil) higher.
I heard that too, I thought it was a sure thing though and it was going to happen. I also read that after this cut the Fed would be taking a break, whatever that means.
The sentiment seems to be calm. I don't really see any need for a cut. Remember we can't cut it below 0%. so I think it is better to conserve the ammo now.
does that mean mortgage interest rate will go down too? i want to buy a house at end of the year or early next year. as for weak dollar, a lot chinese people in US are losing money big time. a couple of years ago, 1 dollar=8 rmb, now it's barely 1=7. it dipped down to 6. if we go back, we would be considered 'poor' folks.
Impeach Bernanke. No, seriously. This is getting out of hand. The man is wreaking havoc with the dollar and the business climate, and the middle class are paying for it. Thankfully, I've been able to stay above it, but people are hurting.
I am curious how those low income/foodstamp people are hurting due to the rising rice/bread price. How serious is it? Probably not serious enough to have riots on the street....
What's scary is that they know something more...something a lot worse. That they're looking at data that suggests the economy is so bad, otherwise, that we'll just have to worry about inflation later. Honestly, there's no other real explanation for this. These guys aren't idiots.
You just made me feel a lot better, Max! Seriously, that's a valid concern. Why another rate cut now? You may be on to something. Impeach Bush.
I highly disagree - today's financial markets are simply too gigantic and over-arching for a group of wise men to have access to a secret cache of tea-leaves to which no one else is privy. The Fed is guessing and taking its best shot like everybody else.
I previously did not like the rate cuts, but I am starting to believe in them. I think Bernanke cut rates to stop a depression. As a student of the great depression he knew that one of the big catalysts was the restriction of the money supply in the early 30s. Therefore, his goal was to flood the market with the money. I think the fed wanted to keep lowering rates until the credit markets began operating normally again. I am not a wall street insider, so I do not know if that has happened, but I have read several articles indicating that those credit markets are doing better. I do believe the fed will cut by another .25 %. I just hope they send a message that things are better enough that they will now be stopping.
i love the "they have to know more" argument. sam is 100% spot on. they certainly didn't "know more" when they were encouraging the subprime/housing bubble.
I'm not suggesting they're the only ones who know what's going on. I'm suggesting they've looked at an assload of data and come back with this....which is pretty inexplicable to me. I'm not pretending to know this is happening...just throwing it out there.
All the better reason to get it out of their hands. But in the interim: Impeach Bernanke for gross incompetence!
