IMO a fed cut won't help, the problems are much more serious. There would need to be much more urgent, critical and decisive intervention to stave off a market crash. A "surprise" cut is very predictable at the moment and IMO would just cause a 30-50 point ES blip which would then be sold into. It might even exacerbate the ultimate panic by suckering in new buyers at 1150-1175, who will then get stopped out 100 points lower.
I don't think the authorities will be able to react quick enough to stop stocks crashing. They have about 48 hours to do something otherwise we hit S&P 1000 within the next day or two. IMO they should forget stocks and focus on making sure that sound companies in the financial system don't get taken down along with the insolvent badly managed ones. A market crash would be good as it would create a true capitulation from which we can bottom and restore confidence. Everyone but the strongest hands would be washed out. It would be far preferable to yet another zero credibility meaningless gesture (like prior "surprise" cuts, and the short-sale ban), that just prolongs the Chinese water torture of this bear market.
I don't think the authorities will be able to react quick enough to stop stocks crashing. They have about 48 hours to do something otherwise we hit S&P 1000 within the next day or two. IMO they should forget stocks and focus on making sure that sound companies in the financial system don't get taken down along with the insolvent badly managed ones. A market crash would be good as it would create a true capitulation from which we can bottom and restore confidence. Everyone but the strongest hands would be washed out. It would be far preferable to yet another zero credibility meaningless gesture (like prior "surprise" cuts, and the short-sale ban), that just prolongs the Chinese water torture of this bear market.