Exactly AAA.
Thanks.
Bernanke Is Clueless
- Thread starter AAAintheBeltway
- Start date
Exactly AAA.
Thanks.
I think you guys are missing the bigger picture...Barnie has been doing a good job of keeping his hands of and letting these problems work their normal course....he was allowing pain and suffering for the long term benefit and allowing the housing market to get its shit in order......READ what he said, don't focus on WHAT he did:
The Federal Reserve cut the discount rate to 5.75% from 6.25% in an unscheduled meeting this morning. The central bank noted that market conditions had deteriorated since its last meeting Aug. 7. "Financial market conditions have deteriorated, and tighter credit conditions and increased uncertainty have the potential to restrain economic growth going forward," the Federal Open Market Committee said in a statement. "The downside risks have increased appreciably." Bloomberg (8/17)
1) They had an emergency meeting between meetings..WHY?
2) He cut 1/2 point..not a 1/4....WHY?
3) " The DOWNSIDE risk has appreciated greatly" " the word " DETERIORATED" was used....WHY?
Im betting one or more of the large banks/brokerages is in BIG trouble and he may have been handed a report that showed 20% or more of the loans out there may foreclose in the next year...this clearly is a panic move....now the question is WHAT DID HE READ????? The RE market is collapsing like a deck of cards and the Banks won't even loan money to people to buy them out of foreclosure even though they can put 10-15% down....why won't they loan? maybe becuase there already know they are upside down?
The Federal Reserve cut the discount rate to 5.75% from 6.25% in an unscheduled meeting this morning. The central bank noted that market conditions had deteriorated since its last meeting Aug. 7. "Financial market conditions have deteriorated, and tighter credit conditions and increased uncertainty have the potential to restrain economic growth going forward," the Federal Open Market Committee said in a statement. "The downside risks have increased appreciably." Bloomberg (8/17)
1) They had an emergency meeting between meetings..WHY?
2) He cut 1/2 point..not a 1/4....WHY?
3) " The DOWNSIDE risk has appreciated greatly" " the word " DETERIORATED" was used....WHY?
Im betting one or more of the large banks/brokerages is in BIG trouble and he may have been handed a report that showed 20% or more of the loans out there may foreclose in the next year...this clearly is a panic move....now the question is WHAT DID HE READ????? The RE market is collapsing like a deck of cards and the Banks won't even loan money to people to buy them out of foreclosure even though they can put 10-15% down....why won't they loan? maybe becuase there already know they are upside down?
Irrespective of the good move today one thing must be said - Barnie is quite bad in managing the consensus within Fed and in communication with the market. Why the hell did Poole "confuse" people just about 24 hours before the change in the discount rate?
In comparison to ECB Fed is like a bunch of kids. I don't believe Ben anything since July06 (after his 6 months grace period expired).
In comparison to ECB Fed is like a bunch of kids. I don't believe Ben anything since July06 (after his 6 months grace period expired).
I think you make a good point, and it's one I am becoming increasingly concerned about. Bernanke is a smart guy, but is he a leader? Can he command the Fed through force of personality and intellect or is he doomed to have pricks like Poole trying to undermine him?
What you don't realize is that a mild recession once every five years is a very healthy thing as it forces people/businesses to respect risk and make smarter investment decisions. When the fed tries to 'pre-empt' every recession thru inflation - they simply allow economic imbalances to grow to the point that only a depression can correct them. Just look at Japan - in a depression for 20 years now. But they've survived because of very high savings and a strong export market. We have niether to support us thru bad times. Everyone in this country from people to businesses and government are debt/credit crack addicts. And since we don't want to go into rehab or even acknowledge the problem - I bet we with just continue to inflate out of this mess to the point where people get tired of holding dollars that are constantly depreciating, dump them em mass and hello hyperinflation. $30 for a cup of starbucks coffee in 5 years guaranteed.
