Bernanke: Fed ready to cut interest rates again

[LegendKiller]

Originally posted by: Jaskalas

Originally posted by: LegendKiller
The US government isn't complicit in this and the dollar is worth quite a bit. Stop using hyperbole to try and froth the issue.

Dollar isn't dead yet, proof that we should keep stabbing it.

It's amazing that people cannot see the balance between the two.

Could it be possible that if we let the financial markets tank that the dollar will drop even faster and wouldn't recover for quite some time?

 

[Jaskalas]

Originally posted by: LegendKiller

Originally posted by: Jaskalas

Originally posted by: LegendKiller
The US government isn't complicit in this and the dollar is worth quite a bit. Stop using hyperbole to try and froth the issue.

Dollar isn't dead yet, proof that we should keep stabbing it.

It's amazing that people cannot see the balance between the two.

Could it be possible that if we let the financial markets tank that the dollar will drop even faster and wouldn't recover for quite some time?

So we lower rates, the economy still falters, then what? You seem to think we?re in control of this via interest rates alone. I?m saying the results could crush our economy just the same.

 

[LegendKiller]

Originally posted by: Jaskalas

Originally posted by: LegendKiller

Originally posted by: Jaskalas

Originally posted by: LegendKiller
The US government isn't complicit in this and the dollar is worth quite a bit. Stop using hyperbole to try and froth the issue.

Dollar isn't dead yet, proof that we should keep stabbing it.

It's amazing that people cannot see the balance between the two.

Could it be possible that if we let the financial markets tank that the dollar will drop even faster and wouldn't recover for quite some time?

So we lower rates, the economy still falters, then what? You seem to think we?re in control of this via interest rates alone. I?m saying the results could crush our economy just the same.

I never said we were. I merely point out that we raise rates and do nothing it would most likely result in a far worse scenario.

 

[SSSnail]

I'm not advocating a total tank, as everything is at stake. But, holistically propping it up is never good either and you should know that with your infinite financial market wisdom. I just laugh at your general direction about your gross inaccurate assumption, and then scoff and maybe a sneering here and there, then dismiss. See how easy that was?

Maybe I'm just bitter with everything that has been going on for the last 10 years, and just want SOMEONE to pay for their mistakes after mistakes after mistakes after mistakes. As it stands, damned if we do and damned if we don't punish them.

 

[PingSpike]

I think what LegendKiller is getting at is that an effort to (probably fairly) punish those responsible would just be cutting off one's nose to spite the face. It would be little solice to the rest of us if those responsible lost a bunch of money if the punishment also involved destroying the underlying economy. And a complete collapse would have heavy collatoral damage to those who were "doing things right" as well as those that fucked everything up.

 

[LegendKiller]

Originally posted by: SSSnail
I'm not advocating a total tank, as everything is at stake. But, holistically propping it up is never good either and you should know that with your infinite financial market wisdom. I just laugh at your general direction about your gross inaccurate assumption, and then scoff and maybe a sneering here and there, then dismiss. See how easy that was?

Maybe I'm just bitter with everything that has been going on for the last 10 years, and just want SOMEONE to pay for their mistakes after mistakes after mistakes after mistakes. As it stands, damned if we do and damned if we don't punish them.

Who isn't getting punished? Merrill is going to write down 15bn, Citi another 20. About the only unscathed bank out there is GS, which has just been lucky. CEOs are getting punted, along with the staff that caused the problems.

The guilty are losing their homes, banks are having problems raising capital. Nobody is being "propped up" so to speak.

 

[1EZduzit]

Originally posted by: LegendKiller

Originally posted by: 1EZduzit

Originally posted by: LegendKiller

Originally posted by: Jaskalas

Originally posted by: PC Surgeon
I'm getting the feeling they have to cut interest rates to divert having a recession. Why do they have to? The feeling I get is they think having a recession will crash the economy. Hell I could be wrong but theres something not being said here.

Cutting interest rates will further destroy the dollar and our economy. This is a lose/lose situation.

and not cutting rates with not destroy the economy, but gut it and then put us into a tail spin.

I've come to the conclusion that it's going to happen anyway, the only question is are we first going to bail out all the politicians and their buddies/backers who got us into this mess. Remember GWB at that fund raiser/dinner. Some people call them the elite, he calls them his base. Ha ha..... well their NOT mine!!

Almost the whole time GWB has been POTUS we've heard talk about the economy making the perverbial "soft landing" and now we need to bail out people who should have know better. Sorry but the Chimp in Charge not only screwed us over on foregin policy, he did as bad if not worse of a job in economic policy and the shit is just starting to hit the fan..

The banks need to trim their fat first and I don't see that happening. We've never had so damn many banks around before and they're all building new building, remodeling, etc.. Ask yourself why that is? It's because they've been making MONEY. Don't expect me to support bailing them out.

Just think we had a balanced budget when GWB took over and look at the mess he's made of everything in 7 short years. He may think he's been talking to God, but I guess nmobody ever told him the road to Hell is paved with good intentions. If they did he wouldn't of understand it anyway.

If the finiacial market needs to be propped up via artifically induced low interest rates then it's done people. I'm getting tired of bailing out institutions because of nothing but their own greed. Take the assholes off life support and let them live or die on their own. They can go find themselves some real jobs, because half the problem is we have too many people specualting and pushing papaers rather then doing any REAL work.

Why do people think that the banks are in isolation of the market?

"Awe, fuck it, it's just a bunch of rich bankers"

Really?

Do you really think that?

It's not everything from pumping your gas (trade receivables) to paying your student loan (SLABS) to raising equity and buying capital equipment?

Naw, it's just rich bankers. Screw them...

I personally don't buy into the "OMG the sky will fall if we don't lower the interest rates" story. As far as I'm concerned it's just another election year song and dance act.

I lived through the farming crisis when the price of land fell by two thirds and simultaneoulsy interest went from 7% to 18% in something like a year. I had to get a job, my wife had to get a job in order to pay the bills and keep farming and we worked our asses off while the "rich bankers" and their friends sat on their asses and made money off the market. Now the shoes on the other foot and listen to everybody cry. They made their bed now let them lie in it. I guess it all depends on whose bull is being gored, doesn't it.

Not everybody survived the farm crisis but we're all better off for it. I think if something similar happened in the finiacial sector we'd all be better of in the long run too.

 

[LegendKiller]

Originally posted by: 1EZduzit

Originally posted by: LegendKiller

Originally posted by: 1EZduzit

Originally posted by: LegendKiller

Originally posted by: Jaskalas

Originally posted by: PC Surgeon
I'm getting the feeling they have to cut interest rates to divert having a recession. Why do they have to? The feeling I get is they think having a recession will crash the economy. Hell I could be wrong but theres something not being said here.

Cutting interest rates will further destroy the dollar and our economy. This is a lose/lose situation.

and not cutting rates with not destroy the economy, but gut it and then put us into a tail spin.

I've come to the conclusion that it's going to happen anyway, the only question is are we first going to bail out all the politicians and their buddies/backers who got us into this mess. Remember GWB at that fund raiser/dinner. Some people call them the elite, he calls them his base. Ha ha..... well their NOT mine!!

Almost the whole time GWB has been POTUS we've heard talk about the economy making the perverbial "soft landing" and now we need to bail out people who should have know better. Sorry but the Chimp in Charge not only screwed us over on foregin policy, he did as bad if not worse of a job in economic policy and the shit is just starting to hit the fan..

The banks need to trim their fat first and I don't see that happening. We've never had so damn many banks around before and they're all building new building, remodeling, etc.. Ask yourself why that is? It's because they've been making MONEY. Don't expect me to support bailing them out.

Just think we had a balanced budget when GWB took over and look at the mess he's made of everything in 7 short years. He may think he's been talking to God, but I guess nmobody ever told him the road to Hell is paved with good intentions. If they did he wouldn't of understand it anyway.

If the finiacial market needs to be propped up via artifically induced low interest rates then it's done people. I'm getting tired of bailing out institutions because of nothing but their own greed. Take the assholes off life support and let them live or die on their own. They can go find themselves some real jobs, because half the problem is we have too many people specualting and pushing papaers rather then doing any REAL work.

Why do people think that the banks are in isolation of the market?

"Awe, fuck it, it's just a bunch of rich bankers"

Really?

Do you really think that?

It's not everything from pumping your gas (trade receivables) to paying your student loan (SLABS) to raising equity and buying capital equipment?

Naw, it's just rich bankers. Screw them...

I personally don't buy into the "OMG the sky will fall if we don't lower the interest rates" story. As far as I'm concerned it's just another election year song and dance act.

I lived through the farming crisis when the price of land fell by two thirds and simultaneoulsy interest went from 7% to 18% in something like a year. I had to get a job, my wife had to get a job in order to pay the bills and keep farming and we worked our asses off while the "rich bankers" and their friends sat on their asses and made money off the market. Now the shoes on the other foot and listen to everybody cry. They made their bed now let them lie in it. I guess it all depends on whose bull is being gored, doesn't it.

Not everybody survived the farm crisis but we're all better off for it. I think if something similar happened in the finiacial sector we'd all be better of in the long run too.

Funny, you take the farm crisis and do not extrapolate it to the rest of the market?

 

[StageLeft]

Well, the stock market is, I think it fair to say, in free fall. It has now fallen a solid 10% from its high that we saw not long ago. Fear mongering is silly, but hypothetically speaking imagine where it would go if another 911 happened now. Also, the US's global triple-a credit rating apparently is in jeopardy if it doesn't fix its soaring SS and healthcare costs.

Course, all I do is get this stuff from drudge, so it's not as if I'm spending that long every day studying it (which is fine, as I have zero input whatsoever in it. Heck, I cannot even vote).

 

[bamacre]

Hillary - "Let's borrow more money."

 

[TheSlamma]

Pretty soon we are going to have to tell the illegals to pay with their pesos so we get good exchange rates up here.

 

[GrGr]

Originally posted by: LegendKiller

Originally posted by: Jaskalas

Originally posted by: LegendKiller
The US government isn't complicit in this and the dollar is worth quite a bit. Stop using hyperbole to try and froth the issue.

Dollar isn't dead yet, proof that we should keep stabbing it.

It's amazing that people cannot see the balance between the two.

Could it be possible that if we let the financial markets tank that the dollar will drop even faster and wouldn't recover for quite some time?

But if you cut rates the dollar will tank too as people will use cheap dying dollar loans to buy booming gold. It will create, or rather speed up, a carry trade of sorts out of the dollar and into anything else that is seen as having permanent value, or far higher returns, than the pitiful return of the rates. Die dollar die. Fed talk of cutting rates is no longer propping up the market as it used to. The Dow fell 250 points today even as rate cuts are expected.

When or if the dollar ever recovers you will find nations like China, Russia, Japan and Europe sitting on enormous mountains of dollars. Frankly, there are too much dollars in circulation now, that there are foreign Sovereign Wealth founds backed by $ Trillions of dollars, for the dollar to ever come back as strong as it was before. The basic problem of too much US debt and too many dollars in circulation will not be addressed, but compounded by rate cuts. The US should raise rates, like Volker did, to attract hard dollars back into the system again and fix the liquidity problems that way. Gold, oil and food are inflating seriously atm, while property and stocks are devaluing. Lower rates means higher trade deficit. Even though the dollar is sinking the trade deficit is still growing. Inflation and debt is killing the US economy, and the US should start to address those problems and not make them worse by cutting rates. Sooner or later the US will have to bite that bullet.

 

[Jhhnn]

Somehow, some way, it seems to me that investors have good reason for being skittish, and cutting rates won't really change that- it may make things worse over time, even if it helps the banks and investment houses in the short term.

All the big players, including the Fed, are doing their damnedest to prevent the kind of correction in the housing and commercial paper markets that would normally follow in any speculative market peak- which means that their exposure must be huge and potentially ruinous. They hadn't planned on holding all that paper, but rather on passing their rosy risk figures on to investors...

They got caught holding a bigger bag than they can comfortably carry, and need time to lighten their load onto somebody, anybody else... like the FHA, VA, Fannie Mae, Freddie Mac and anybody else who'll take it... including consumers. Low short term rates just stretch it out and facilitate that off loading. It's the perfect execution of the "Greenspan Put"- they screwed up so badly that they're holding the whole economy hostage, and getting away with it, at least for now.