Boston Fed's Rosengren Says Fed May Soon Have To Buy Stocks

[murray t turtle]

Greenspan gave the market a "surprise!" rate cut in 2000--not only once, but TWICE. Bernanke gave the market a glut of free money to the detriment of the regular Joe-sixpack. So why am I not surprised?

When the Fed makes an emergency move, it’s usually an emergency

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That good lookin' woman you have a pic of, she likes drama?? LOL
Several reasons FED did/does that. [1] Jim Rogers said the FED gets a call from all the funds.....[2]As a bank regulator+ with about 51 % of USA long stocks.mutual funds ETFs pension plans; I'm not surprised with FED rate cuts also . [By the way; its not a benchmark, or very liquid; but i track SDOW. When DOW goes down SDOW goes up]
Forbes magazine was source for % of USA in stocks/ETFs/mutual funds/pension plans/Roth Accounts.............................

 

[piezoe]

What a SCAM!
So the Treasury would "indemnify" the FED against losses??
Then WHY should I pay TAXES to subsidize ALL these motherfuckers????

The Fed and Treasury are one operation made to look like two,

 

[piezoe]

The Fed should have adjusted the margin requirement several months ago when the S&P was well above its long term channel and its rate of rise was increasing. This correction now is healthy so far. Why is the Fed intervening now in a ridiculous attempt to keep an irrational bubble alive? And why intervene with a funds rate cut. It's an ineffective measure as intended, but the unintended consequence is a panic signal sent to the market. The Fed should have done nothing at this point, since they failed to act in a timely manner to adjust the margin requirement. They should now let the Market fall spontaneously back into the long term S&P Channel. They can intervene later if the market threatens to fall out of its long term channel. We are a long ways from that. One gets the strong impression that the Fed Board is succumbing to political pressure rather than acting responsibly.

 

[southall]

When do they ever sell?

Once they have X Trillion worth of stock they cant ever sell it without crashing the markets.

Also if US stocks are artificially propped vs the rest of the world, why would investors invest in the US, when they can find better value else where?

 

[kashirin]

When do they ever sell?

Once they have X Trillion worth of stock they cant ever sell it without crashing the markets.

Also if US stocks are artificially propped vs the rest of the world, why would investors invest in the US, when they can find better value else where?

Fed doesn't need to buy stocks to prop market. They sell Vix and buy futures. Futures are cash settled

 

[zdreg]

Why? Bank of Japan is buying ETF´s for a long time....And Swiss National Bank has large stakes in US stocks - like Apple & Co. So, what´s madness about?

It's not capitalism when you try to end the business cycle. Attempting to eliminate downturns will end badly.

 

[Real Money]

What a joke....

Global central banks engage in a regime of systematic suppression of sovereign debt yields, forcing savers into risk assets under the auspices of promoting competitive growth.

The trade gets crowded.

Then, inevitably, the assets are repriced in the face of emergent risk. The investing public, who is not in a position to absorb risk (they are aging and in need of low risk income sources) take a loss.

The banks want to fix it doing more of the same. Central banks assumed that any emergent risk could just be 'fixed' with monetary policy. They were wrong.

 

[dozu888]

this is a moot point... Fed has always been buying stocks, just not directly.