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interest rate cut? lmao
- Thread starter staffpro
- Start date
Quote from scriabinop23:
Long term no... Housing losses need to bottom. But it would improve the corporate and housing fundamentals without a doubt.
Lowering the cost of capital basically supports higher prices for everything (since risk free rate being lower formally justifies a higher multiple on all assets).
But just imagine the wave of refinancing a 100bp cut will stimulate when you additionally consider where mortgage rates will then be. You can get a 30 yr mortgage for 5.75 pretty easily on a primary home purchase right now. Imagine 4.75% interest rates....
Then imagine how corporate debt will become easier to raise as well... So what if spreads are higher than last yr if your baseline rate is much lower.
my thoughts too, it would basically create a period of even easier money than the one in early part of the decade, it would stimulate hyper growth for a short period (and stocks would probably rally hard) and then an even bigger bust.
Cramer is right about one thing. Cutting would give banks a chance to catch their breath and reload their balance sheets. It would save the government a ton of money that will otherwise go to mortgage bailouts. Inflation? Does Japan have an inflation problem?
Bernanke will have to lose that deer frozen in the headlights approach though and get ahead of the curve for once. Can't really see that happening.
Bernanke will have to lose that deer frozen in the headlights approach though and get ahead of the curve for once. Can't really see that happening.
There will be no ease. Get real.
Quote from Daal:
Interesting how I got flamed when I suggested that if the fed was to make any kind of move it would be an ease not a hike
i dunno when you suggested that but if you suggested it when euro was 1.50+ and oil was $140 THAT MIGHT HAVE BEEN A problem, this market is so confused that everyone's opinion is changing daily, we need to see some leadership from the fed.
I doubt they'd need to pay that much of a premium.
If anything, I think a GS acquisition is done below the market price at the time of the announcement.
If anything, I think a GS acquisition is done below the market price at the time of the announcement.
Quote from danp01851:
ransquawk just reported there are rumors going around about an emergency rate cut today, which might be the cause of the spike in the markets.
Also a rumor about Goldman buying Lehman for $11.50 a share.
Quote from m22au:
The Fed / Treasury is running out of bullets, however they do still have room to cut all the way to zero.
Whether or not rate cuts make much of a difference in months down the track is another thing.
The Fed is based on loaning currency to the treasury AT INTEREST. Even if the discount rate is zero, the Fed still makes money on the taxpayers with its Monopoly money, and has since 1913.