Fed cuts rates by .75 today. Again!!!!

It also hurts those that have saved money.

oh man oh man

Just means the dollar is going to get shittier. But hey, the Wall Street guys can make some money so who gives a shit if gas is $5/gallon.

Yes, absolutely. They are forcing you to spend your savings or get 1% annually on your savings.

now whats the best way to take out a loan to repay all my credit cards I wonder...

When will this trickle down to US? been planning on refinancing my house and one this weeks cuts can make it to us sounds like a good time to

you guys should burn the FED and hang all their wallstreet budies, since these rate cuts in face of high inflation are really insane and are only there to save their asses.

from someone else, simply said:
""Poor Ben can't understand that the US export economy can't make up for the losses in the financials and dropping rates to take away (or devalue through inflation) capital from the non-financial sector will only result in more unemployment and an even bigger recession""

Barrel of oil for 110 and they cut?
Their cuttings creates huge bubble in speculation against US dollar and in oil, therefore Joe six pack has to pay more for all imported things.

I don't know if the 30 year mortgage will go down much. Yesterday it was about 6.375, but it could drop within few days. This will reduce equity lines, which are normally based on Prime.

In five minutes I'm out the door to my mothers house ... going to help her with her investments. The stock market really isn't the place for someone that's in her seventies and in bad health ... a 1-2 % cd sucks also.
The state of Florida must be in a state of shock.

It's necessary in the light of more stress in the banking system. Bear Stearns had to be bailed out Monday. Once big banks go bankrupt that will have devastating repercussions for everyone and the entire economy. Think credit crunch and potentially a decade of deflation a la Japan in the 1990s.

Or move into other assets/investments.

What's ironic about this is that the stock market may actually close in the red for the day, because most people were expecting a full point cut.

It's amazing how much the financial markets are merely a perception game.

The fed did not want to cut it a full point in one day. That is why they cut it a quarter point on Sunday.

http://www.gfy.com/showpost.php?p=13928677&postcount=5

All these bail outs for poor people must make responsible people cringe they saved their money. They should just buy homes they can't afford, max out their credit cards and go bankrupt - smarter financial move at this point lol

Two different rates.
Discount rate was cut one quarter on Sunday.
Federal Funds rate was cut today

My bad.

Discount rate was cut one quarter on Sunday.
Federal Funds rate was cut today 3/4 today and so was the Discount rate cut another quarter

As usual a thread full of "educated" economists that don't have clue how the system really works at all

Please enlighten us Mr. Buffett.

I think the fed is shooting in the dark. It is not an absolute science. It is lots of guess work. This reduction might be good or it might be very bad for the future. They are not sure either.

CNN keeps interviewing people today who say "I know we probably couldn't afford the house we bought, but we did it anyway because we thought it was a good idea." Since when is buying things you can't afford to pay for a good idea? CNN is treating it like a sob story when these people clearly overextended themselves.

That said, I have tons of sympathy for people who ran into unexpected dire straights like loss of job or health and then found themselves in financial trouble that way.

That same argument is what got Bush elected, and re-elected.

Just because people are in positions of power, or are "educated" doesn't mean their deductions result in the right play, based on 95193561959152 factors out of their control.

There is no bailout for poor people. The bankruptcy laws were changed in 2005 to make sure it's near impossible to file for it. The only bailouts we've had are for companies like Bear Stearns. The billionaires are being bailedout, not the poor people.

Yep we are heading for hard times. Maybe gas will be 6.00 too.

Yeah, personal responsibility and bad choices are being left out of the conversation more and more. The FED cut rates which made a housing bubble possible but not inevitable. We discussed housing on GFY in many threads back in 2002-2004. So many people said "housing prices always go up". When examples like the Tokyo real estate market were presented they said "That is japan, not the US". All the people I met who were buying and flipping condos in 2003 in Miami were making poor business decisions.

The financial institutions which made loans to people they should not have been made to are certainly taking it on the chin and deservedly so. also true that the speculators are being fairly taken down and the homeowners who purchased homes with rate resets they didn't understand. if you can't or don't understand a contract don't sign it. if you can't afford a loan don't take it.

Personal responsibility all around.

I don't post here what I wanted to say

lol

and the Harvard educated economists have no more clue really than the armchair economists. Greenspan even admitted he had no idea what the hell the sub prime mortgages were about or the possible impact.

if it was simple as you imply it is for somebody who really understands 'how the system really works' there would be no mess to start.

The dismal science

It will only make things worse in the long run as his policy is causing squeezing of productive economy in order to restore currently unproductive economy
.Actually its necessary in light of stress to clear the whole system.
You dont restore trust, confidency and end credit crunch by further playing gimmy tricks with Level 3 assets, mark to model, rating agency bullshit, TAF window, etc.


from:
http://market-ticker.denninger.net/2...tion-mess.html

"Bernanke needs to decide whether he is going to address the willful regulatory ignorance emanating from The Fed and other banking system regulators or whether he prefers to have the credit markets seize up piece by piece, margin call by margin call, until we finally force into the open the institutions that are insolvent - the hard way.

Down the latter road lies a rerun of the 1930s or a Japan-like situation, with both being brought about by precisely the same sort of regulatory refusal to force market participants to face reality.

The bad news is that I fear that Bernanke has very little time left to get off his kiester as the market is choosing for him. He's wasted the last six months running the old Greenspam playbook but unfortunately this is not LTCM where you literally have one institution that got in trouble - this is much more serious as the we quite literally have all areas of the credit markets seizing up because trust has been destroyed.

What's worse, Bernanke and his Fed have destroyed confidence in our currency by willfully refusing to address the root cause of the problem and that is being reflected in the DX.

The irony of this is that the longer Bernanke fiddles with his bullcrap "rate cut" nonsense trying to shove more heroin at the junkie, the worse the dollar craters and the more inflationary pressure this puts back into the economy through higher import costs, with the most important of those being the energy complex! "

Its from blog, but that guy has been more right then 99% of CNBC.

now I can get a low-interest loan to buy gas with!!

woohoo

Now Greenspan is saying we may be entering a depression that will rival the Great Depression.

But keep printing those fiat dollars!

I just saw a Hudson truck, all loaded up with the Joad family, driving down the street.

the point of Japan deflation has been just hit, money flew from financial system and they are hidding in short term US treasuries, see:
http://finance.yahoo.com/q/bc?s=%5EIRX&t=5d

to see context of whole situation:
http://finance.yahoo.com/q/bc?s=%5EI...=on&z=m&q=l&c=

Until the confidence is restored money will be hidding or will go somewhere else (long term US treasuries or go out of US), but not in US financial system