A range of 0% to 0.25%?
I guess stocks like the news and the statement but the statement sounded awful. Holy schnikies!
Kudos for continuing to be creative, I guess, but I don't trust the reaction in equities. The debt and currency reactions seem more reliable.
Side note; we are in the middle of the biggest December storm here I can remember. It has been snowing non-stop since 3pm yesterday. We are over a foot here and still snowing.
13 comments:
[puke!] to both the markets and snow. I moved out of it 10 years and still can't stand the sight of it :)
Since the rate cuts in the last 12 months have had no real effect on equities why read into today's movement much? I can't justify a couple hundred as more than normal daily gyrations these days. I have been slightly impressed at the ability to hold 8500ish.
This huge storm is due to global warming I am sure. This underscores the urgency with which the president elect must address this issue. Change we can believe in!!!
Why are treasuries continuing to rally? Term doesn't matter, they're all up.
Snowing here in IL. 3-5" and bitter cold.
Sunny and 75 here it Florida. someone has to live here I guess
I'm in Northern Wisconsin, down to my last degree. When that's gone I'll have no temperature at all.
In honor of the Henry Paulson interview "let me just say" I love the snow.
Far from bitter cold it is in the 30s. Two feet of snow with no place to go is pretty good.
The nature of our climate is that in the winter it can snow one day and be sunny and 60 the next.
My weather widget says snow for several more days however.
Roger, since you're stuck inside, visit www.dogwork.com/dogsnow/. It's a guaranteed smile.
Apologies to the non-dog lovers for the off topic post.
In Richmond Va, the weather is cold and rainy.
While the reaction of the market was certainly bullish, I heard nothing in the Fed statement but a dirge for the economy.
Bloomberg has some video clips from Rogers (sell all dollar denominated assets; fundamentals are not impaired for commodity stocks) and Jim Chanos (shorting healthcare/defensive names).
I understand the dollar tanking with today's news. It's a little asynchronous the synchronicity in both bonds/stocks in their dual rallies. One of those asset classes is a dotard. Though it would be hard to argue that a rally in the market would go a long way to chasing some of the bear crash blues.
Lots of folks touting high yield bonds. If the consumer is 70% of the GDP AND if the consumer has not been reliquified (they have note) AND the consumer is worried about employment (and they have reason to be) then I see dead stocks walking and corporate bonds defaulting (for some). ONe of the issues with the debt bubble is that money sought a better yield than that offered by safe investments. I have some fear that credit spreads, which may need to stay wide to appropriately price risk, will narrow, and we'll have Act 2 of this terribly produced tragic play.
For now, I'm treating this as a bear market rally; holding onto the belief that we we are undergoing a prodigious consumer-led recession, the effects only beginning to show; deflation is certainly one of Scrooge's ghosts from Depression and Japanese past that is trudging along and clanking its chains of despair.
Nevertheless, I'm staying flexible. (Sorry to be so longwinded).
Fresh snow and a cold front hanging over the Pacific NW but, wow, what a glorious day. Almost time for the winter Steelhead run too.
And yes, the Fed is now "all in" and here comes the river.
Goes the right way and people feel like buying a bit again; might as well cuz money's going to worth less tomorrow anyway, right? Bond spreads shrink and credit relaxes a little, what the heck might as well get a loan, and the stock market never hits lower lows. Inflation kicks into gear, most definitely, but the Fed knows how to handle that and, with a win here, has the means to handle it too.
Goes the wrong way and people get more careful, stingy, a penny saved is a penny earned (for real), more bad times acoming y'know: You can ask your grandparents (or parents if you're old enough) what happens when everyone suddenly discovers financial virtue at the same time, 'fraid it makes me feel slightly nauseous.
PS: I'm sure anyone who thinks a little snowfall casts doubt on "global warming" (sic) won't be interested but this "Gallery of Climate Change Predictions" @ http://tinyurl.com/6h6ksz has some high quality graphic representations of the prevalent models for those who are (rest of the site is interesting too, to everyone else I mean).
If its Switzerland...
Roger, did your "private" bank have any money with Madoff?
:-)
Watch out for the Gnomes of Zurich.
Well that's interest rates taken care of, what's next in the Fed's armoury?
Here is was a little cool this morning, I've taken to wearing a jacket until the afternoon. No clouds in the sky but that wind can be a little chilly on occasion.
This winter reminds me of what my dog once said to me after dis-engaging from a particularly passionate romantic encounter with a skunk:
"Master, I have enjoyed about all of this I can stand".
there is nothing wrong with talking to your dog however when the dogs starts talking to you, well, um...lol
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