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Thread: The Fed's continued rate cuts are reckless

  1. #1

    The Fed's continued rate cuts are reckless

    The stock market is supposed to be one of the most significant leading indicators of the economy, so how on earth have we seen three rate cuts now with the S&P 500 just 2% off of its all-time high? Historically, the Fed does not cut rates until the stock market is well into a decline.

    With stock prices close to their highs and commodity prices continuing to accelerate, the rate cut is a move that only serves to delay the inevitable housing letdown, send the dollar lower, and inflate prices for all Americans.

  2. #2
    [QUOTE=BrooklynBound;2188053]The stock market is supposed to be one of the most significant leading indicators of the economy, so how on earth have we seen three rate cuts now with the S&P 500 just 2% off of its all-time high? Historically, the Fed does not cut rates until the stock market is well into a decline.

    With stock prices close to their highs and commodity prices continuing to accelerate, the rate cut is a move that only serves to delay the inevitable housing letdown, send the dollar lower, and inflate prices for all Americans.[/QUOTE]

    The goal was to make the housing let down more gradual. Speaking as someone trying to sell their home , I will take any help for the housing market I can get.

  3. #3
    The Fed has a policy of steady inflation and has done from the early days of Alan Greenspan; they've found this is the best way to keep Americans and the world happy.

    The problem is the policy has brought about a huge rise in American debt, both public and private. Perhaps in the long run it will end the era of Pax Americana.

  4. #4
    The Fed is the one who caused the mortgage crisis in the first place by allowing the money supply to triple since 1990 by keeping interest rates artificially low for a LONG TIME. This is why so many people yearn for the Clinton years: easy money. And after 9/11 the money got even more easy, and that caused the current crisis.

  5. #5
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    [QUOTE=BrooklynBound;2188053]The stock market is supposed to be one of the most significant leading indicators of the economy, so how on earth have we seen three rate cuts now with the S&P 500 just 2% off of its all-time high? Historically, the Fed does not cut rates until the stock market is well into a decline.

    With stock prices close to their highs and commodity prices continuing to accelerate, the rate cut is a move that only serves to delay the inevitable housing letdown, send the dollar lower, and inflate prices for all Americans.[/QUOTE]

    The Fed isn't in the business of cutting rates just to support the stock market. Their job is to control inflation, provide liquidity and maintain "normal" GDP growth....not too hot and certainly not recessionary. They've been cutting and doing some other unorthodox things to provide liquidity to the banking sector and help free up a credit market that is seizing due to abnormalities in the markets for asset-backed securities. And by asset-backed I mean mortgage-backed. There are fears that the problems in these capital markets, like today with Citi and recently with a write-down by Merrill, could spill over into the broader economy.

  6. #6
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    [QUOTE=JetsCrazey;2188629]The Fed is the one who caused the mortgage crisis in the first place by allowing the money supply to triple since 1990 by keeping interest rates artificially low for a LONG TIME. This is why so many people yearn for the Clinton years: easy money. And after 9/11 the money got even more easy, and that caused the current crisis.[/QUOTE]

    Easy money is part of it but people using it incorrectly is the bigger part. There are guns in the world but it takes a person to shoot them off. The bigger problem is the recent (2002+) creation of strange financing products for homes that pushed uncreditworthy people and weekend real estate speculators into a market they should never have been in. Easy money didn't create the Tech bubble of 1999-2000 and it isn't the primary cause of the housing problems now. These are structural problems fueled by get-rich-quick idiots armed with Option ARMs and paintbrushes.

  7. #7
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    I have one word for you:


    Amero

  8. #8
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    [QUOTE=jetstream23;2188644]The Fed isn't in the business of cutting rates just to support the stock market. Their job is to control inflation, provide liquidity and maintain "normal" GDP growth....not too hot and certainly not recessionary. They've been cutting and doing some other unorthodox things to provide liquidity to the banking sector and help free up a credit market that is seizing due to abnormalities in the markets for asset-backed securities. And by asset-backed I mean mortgage-backed. There are fears that the problems in these capital markets, like today with Citi and recently with a write-down by Merrill, could spill over into the broader economy.[/QUOTE]

    We know why they are doing it. It still doesn't mean its not reckless.

  9. #9
    [QUOTE=Tanginius;2188876]I have one word for you:


    Amero[/QUOTE]

    Show me any evidence that the US is officially moving to the Euro. I have my problems with the Fed but letís not invent conspiracies

  10. #10
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    [QUOTE=BrooklynBound;2189155]Show me any evidence that the US is officially moving to the Euro. I have my problems with the Fed but letís not invent conspiracies[/QUOTE]

    Not moving to the Euro... moving to the AMERO!



    Here is a link from CBTNY's fav site:

    [url]http://worldnetdaily.com/news/article.asp?ARTICLE_ID=57980[/url]

    [url]http://en.wikipedia.org/wiki/Amero[/url]

    [url]http://www.amerocurrency.com/[/url]

    [url]http://www.humanevents.com/article.php?id=15017[/url]


    or listen to Vincente Fox on any of his recent TV appearances whoring his new book...

    look into the SPP deal from Baylor TX in 2005 between Bush, Fox and Martin (Canadian PM)...

  11. #11
    [QUOTE=Tanginius;2189351]Not moving to the Euro... moving to the AMERO!



    Here is a link from CBTNY's fav site:

    [url]http://worldnetdaily.com/news/article.asp?ARTICLE_ID=57980[/url]

    [url]http://en.wikipedia.org/wiki/Amero[/url]

    [url]http://www.amerocurrency.com/[/url]

    [url]http://www.humanevents.com/article.php?id=15017[/url]


    or listen to Vincente Fox on any of his recent TV appearances whoring his new book...

    look into the SPP deal from Baylor TX in 2005 between Bush, Fox and Martin (Canadian PM)...[/QUOTE]

    Sorry, the Amero. Long day at work.

    You've posted links that try to prop up the conspiracy. I'm looking for evidence that the US is officially supporting or moving towards the Amero. Of course Fox would want to merge currencies. If I was Mexico, I'd want to as well.

    SPP in 2005? Seriously? What happened since then? Bush has 14 months left, he better get cracking, eh?

    Look, moving to the "Amero" is going to take nothing short of a Constitutional friggin Convention. No offense to the South, but we have states that are still pissed women and blacks can vote - and suddenly they're going to allow us to merge with Mexico?

    There are much more logical explanations regarding why the Fed is inflating our currency.

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