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Fed cuts rate by 3/4 point!!!

Engineer

Elite Member
Oct 9, 1999
39,234
699
126
Holy crap!! :shocked:

We must really look bad as far as the economy for the FED to do this, especially with inflation rearing it's ugly damn head.

More to follow....

Fed Slashes Rates by Three-Quarter Points-
With recession fears growing, the Federal Reserve slashed the federal funds rate by three-quarters of a point. Most investors expected a full-point reduction. Today?s cut comes on the heels of the Bear Stearns bailout and U.S. Treasury Secretary Henry Paulson saying the U.S. economy is in "sharp decline." Details coming?... » read more
 

Engineer

Elite Member
Oct 9, 1999
39,234
699
126
Originally posted by: FDF12389
What does this all mean to the average joe?
Your online savings account won't earn much now!

Considering that the banks have been slow to pass the savings on to consumer loans (autos, credit cards, etc) while they try to make up their loses from subprime, probably not jack shit to me and you (other than lower savings rates).

LOL @ cKGunslinger!!! :laugh:
 

NoStateofMind

Diamond Member
Oct 14, 2005
9,711
6
76
Originally posted by: Engineer
Originally posted by: FDF12389
What does this all mean to the average joe?
Your online savings account won't earn much now!

Considering that the banks have been slow to pass the savings on to consumer loans (autos, credit cards, etc) while they try to make up their loses from subprime, probably not jack shit to me and you (other than lower savings rates).

LOL @ cKGunslinger!!! :laugh:
NVM you stated it in your OP.
 

NoStateofMind

Diamond Member
Oct 14, 2005
9,711
6
76
Originally posted by: Modelworks
Just give them the money for free.
Its not like your going to make them pay it back .
Exactly. Have the government take over the banks, name them "U.S. Government bank" and do away with interest rates all together. Since there is no risk involved anymore.
 

rchiu

Diamond Member
Jun 8, 2002
3,846
0
0
Yeah, this is actually not as big a cut as Wall St. expected. But I see this as a good sign that the Bear Stearns impact on the market is not that big and the Fed is not in a panic mode anymore. Last Sunday the feel was the world was falling apart.
 

Svnla

Lifer
Nov 10, 2003
17,999
1,394
126
At least I just renewed my big CD account for 3.1 APY last week. Now my savings accounts at HSBC and the likes will be lucky to be over 2%.

<<----saving money for 20% down for a new house.
 

palehorse

Lifer
Dec 21, 2005
11,521
0
76
one word: REFINANCE! :)

Any mortgage lenders in here happen to know the average rate offerings coming down the pike?
 

StageLeft

No Lifer
Sep 29, 2000
70,150
2
0
Originally posted by: palehorse74
Any mortgage lenders in here happen to know the current offerings?

one word: REFINANCE! :)
Sorry to burst your bubble but mortgage rates are not going down appreciably. The bonds that back them know that inflation is a major concern and that's why 30 year is 6%+.
 

palehorse

Lifer
Dec 21, 2005
11,521
0
76
Originally posted by: Skoorb
Originally posted by: palehorse74
Any mortgage lenders in here happen to know the current offerings?

one word: REFINANCE! :)
Sorry to burst your bubble but mortgage rates are not going down appreciably. The bonds that back them know that inflation is a major concern and that's why 30 year is 6%+.
that doesnt quite make sense given last months offerings of around 5 to 5.5%... what happened?!

that sucks... i'm at 6.375%, but I wouldnt mind shaving some pts...
 

jpeyton

Moderator in SFF, Notebooks, Pre-Built/Barebones
Moderator
Aug 23, 2003
25,375
141
116
This is great news. The glorious Ben Bernanke has saved the country from a deep recession with his masterful moves.
 

Dissipate

Diamond Member
Jan 17, 2004
6,815
0
0
Holy sh!t, NASDAQ is up almost 4%. Anyone who was holding short positions got slaughtered today no doubt.
 

Capt Caveman

Lifer
Jan 30, 2005
34,547
651
126
Originally posted by: palehorse74
Originally posted by: Skoorb
Originally posted by: palehorse74
Any mortgage lenders in here happen to know the current offerings?

one word: REFINANCE! :)
Sorry to burst your bubble but mortgage rates are not going down appreciably. The bonds that back them know that inflation is a major concern and that's why 30 year is 6%+.
that doesnt quite make sense given last months rates of around 5 to 5.5%... so what happened?
Actually, rates have dropped from 6% to around 5.7% over the last week.
 

Dissipate

Diamond Member
Jan 17, 2004
6,815
0
0
Does anyone realize how insane the volatility in the market is right now? The Fed is orchestrating an insane roller coaster ride. This is just nuts.
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
Originally posted by: Jaskalas
Sooner or later these ?fixes? will create a crisis of their own.
As long as the crisis they cause are better than the crisis that would have been caused without them.

This is the crux of what many do not quite understand. These rate cuts are akin to chemo and radiation to cure aggressive cancer. Sure, the cancer sucks and we could have taken steps to prevent it, but we can't do anything about the past at this point. All we can do is treat the cancer aggressively and eventually put it into remission. At that point we get healthy again.

However, the other alternative is to take some herbal teas, hope that healthy living and a detoxifying diet along with some pain will cure the problem. People will say "let the market sort it out", where the market is your body and you use shit like Chlorela to give your body the tools to fight the cancer, by itself.

Sorry, but I don't have any trust in letting your body trying to work through it without some support that you *know* works to a certain extent.

As far as alternatives, nobody has presented any that will work. Letting the cancer go away by just letting banks fail is a ridiculous idea. It stuffs up the credit environment, which hurts consumers who are trying to refi out of ARMs into something that won't jack their rate up. Even now, they are getting unfavorable lending because the market is constipated.

Meanwhile, you get armchair econonomists pining for the days of a strong dollar, to the preclusion of all other factors. They claim that the market should "just take their medicine" without looking at what that entails. They also claim that these actions only save "bankers", yet fail to acknowledge that bankers and investors are taking their hits.

I love that internet prognosticators think they are so knowledgable about the financial market without having an inkling about what's going on inside of the markets.
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
Originally posted by: Dissipate
Does anyone realize how insane the volatility in the market is right now? The Fed is orchestrating an insane roller coaster ride. This is just nuts.
How is the Fed orchastrating this?
 

tidehigh

Senior member
Nov 13, 2006
568
0
0
Originally posted by: Dissipate
Does anyone realize how insane the volatility in the market is right now? The Fed is orchestrating an insane roller coaster ride. This is just nuts.
yea a roller coaster ride they have the plans for. some people are getting very rich
 

Vic

Elite Member
Jun 12, 2001
48,514
9,470
126
Originally posted by: Capt Caveman
Originally posted by: palehorse74
Originally posted by: Skoorb
Originally posted by: palehorse74
Any mortgage lenders in here happen to know the current offerings?

one word: REFINANCE! :)
Sorry to burst your bubble but mortgage rates are not going down appreciably. The bonds that back them know that inflation is a major concern and that's why 30 year is 6%+.
that doesnt quite make sense given last months rates of around 5 to 5.5%... so what happened?
Actually, rates have dropped from 6% to around 5.7% over the last week.
And the Fed's move today just sent them right back up. If you didn't lock by this morning then forget it.

"What happened" is that the Fed's rate cuts are spurring ever more inflation into the economy which is killing long term bonds and rates.
 

Dissipate

Diamond Member
Jan 17, 2004
6,815
0
0
Originally posted by: LegendKiller
Originally posted by: Jaskalas
Sooner or later these ?fixes? will create a crisis of their own.
As long as the crisis they cause are better than the crisis that would have been caused without them.

This is the crux of what many do not quite understand. These rate cuts are akin to chemo and radiation to cure aggressive cancer. Sure, the cancer sucks and we could have taken steps to prevent it, but we can't do anything about the past at this point. All we can do is treat the cancer aggressively and eventually put it into remission. At that point we get healthy again.

However, the other alternative is to take some herbal teas, hope that healthy living and a detoxifying diet along with some pain will cure the problem. People will say "let the market sort it out", where the market is your body and you use shit like Chlorela to give your body the tools to fight the cancer, by itself.

Sorry, but I don't have any trust in letting your body trying to work through it without some support that you *know* works to a certain extent.

As far as alternatives, nobody has presented any that will work. Letting the cancer go away by just letting banks fail is a ridiculous idea. It stuffs up the credit environment, which hurts consumers who are trying to refi out of ARMs into something that won't jack their rate up. Even now, they are getting unfavorable lending because the market is constipated.

Meanwhile, you get armchair econonomists pining for the days of a strong dollar, to the preclusion of all other factors. They claim that the market should "just take their medicine" without looking at what that entails. They also claim that these actions only save "bankers", yet fail to acknowledge that bankers and investors are taking their hits.

I love that internet prognosticators think they are so knowledgable about the financial market without having an inkling about what's going on inside of the markets.
How can anyone with any sense support the volatility the Fed has created in the market? If your head is screwed on straight there is no way you can support this. These fluctuations in the market are not natural and are actually very damaging.
 

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