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Fed Delivers Emergency 50 Basis Point Rate Cut Amid Virus Scare, Oversubscribed Repos
The Fed cut rates on Tuesday morning, bowing to market demands for emergency action in the face of t
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Too much debt, too much leverage, slowing global economy, aging global population. Deflation is a real concern. Expect to see Fed announcement of real QE by the end of March, if not at its next mtg.
Well they used the only tool they know how to use and it went over like a lead balloon…. Hate to say it but from a simplifier’s point of view this was predictable to about 90%…. Not Rocket science when you mix up your apples and oranges you are not gonna get what you wish for…
Now it is ‘get radical time’ and all bets are off the table because this stew has been brewing almost to completion and believe it…. it is stew !
Any black or grey swan could have tipped the bucket over but the virus was the most successful because it is an unknown and does not respond to the conventional tactics of the last decade….
The virus is essentially an excuse to exodus and lock in gains on an incredibly over inflated market. No interest rate drop changes that. Move to cash, watch the drop, buy back when the virus abates and the MMT and QE begins.
Time for H to put up another banner with Trump’s hair on fire because the Fed isn’t doing enough.
LOL . Oh wait, who’s not doing enough? Pence and Kudlow aren’t reassuring the markets?
Not my work, but deserving of a wider audience. A commenter on a Robin Wigglesworth column in the FT.
Yields, and J Powell I sing, who, forced by fate,
And haughty Mango’s unrelenting hate,
Bullied and battered, drove US rates to fall.
Long labors in the Eccles Building he bore,
And in the doubtful war, before markets fell,
Made liquid repo markets for the bank cartel;
Grew the balance sheet anew after prior sales
That unending stock growth might prevail;
Ethereal gains thence stoked in asset markets
Assiduously excluded from inflation targets.
Yet the glory of this new alchemy was fragile;
Unfixed by eastern illness and unfettered travel.
O Muse! the future tremors and recession relate;
The untimely folly of newly lowered rates!
And tell how the bronzed steward of American autarky,
Shall fare ‘gainst the sworn enemy of all malarkey!