FED Rate Cut

[Lafayette]

Think we are going to 0?

If we do go to 0, think it would speed up the dollars fall?

 

[phill4paul]

They'll go negative. Soon lenders will be paying us with worthless notes to borrow worthless notes!

 

[rockjoa]

The fed will be out of silver bullets and have to resort to mass printing of money in an attempt to save the economy. The real question is how much longer, till hyperinflation steps in?

 

[smokey]

.​

They're already there.

12/05/2008, 0.12
12/06/2008, 0.12
12/07/2008, 0.12
12/08/2008, 0.12
12/09/2008, 0.13
12/10/2008, 0.11
12/11/2008, 0.14
12/12/2008, 0.15

Federal funds effective rate

The floor they tried to put in the overnight rates by paying the target rate for reserves didn't work.

.​

 

[AmericasLastHope]

What is the significance of artificially low interest rates vs. artificially high interest rates?

Is it possible for the Fed to start raising interest rates again, or are they backed into a corner?

Now that Volcker is on Obama's team, is there a chance we could go back to 1980's artificially high interest rates again? If so, what would the effect on gold be?

In other words does the Fed have anymore tricks up its sleeve, or can all they do is print money? Is it game over?

 

[tremendoustie]

What is the significance of artificially low interest rates vs. artificially high interest rates?

Is it possible for the Fed to start raising interest rates again, or are they backed into a corner?

Now that Volcker is on Obama's team, is there a chance we could go back to 1980's artificially high interest rates again? If so, what would the effect on gold be?

In other words does the Fed have anymore tricks up its sleeve, or can all they do is print money? Is it game over?

Their best chance of saving the dollar is to raise the interest rate, but that would make the economic crisis worse. They're between a rock and a rock, trying to do the impossible: magically make a non-producing economy prosperous, by managing the movement of little green slips of paper.

 

[georgiaboy]

Their best chance of saving the dollar is to raise the interest rate, but that would make the economic crisis worse. They're between a rock and a rock, trying to do the impossible: magically make a non-producing economy prosperous, by managing the movement of little green slips of paper.

Yep, idiots, the lot of them.

If they'd just get out of the way, disband, and let private capital begin to flow naturally, we'd all be better off.

To wit, according to a simple Google search, PE firms invested $725 Billion into companies in 2007. That number is eerily similar to what familiar piece of legislation?

 

[ArchPaul]

They're between a rock and a rock, trying to do the impossible: magically make a non-producing economy prosperous, by managing the movement of little green slips of paper.

Reminds me of Weekend at Bernie's! Ben and Paulson trying to prop up
the dead corpse of an economy as if its viable.

 

[Johnnybags]

Rates are zero already almost

The FED is destroying the money market industry, taking over the commercial paper industry and the only result is death to banks. If they lower long rates like they have the spreads will not be big enough to support our bohemoth banking industry and more unemployment will result with fewer larger and larger banks. I have no idea how stocks can go up with money managers piled into treasuries and charging fees on top of it. End result is a massively declining fund industry as well. Who wants to pay a money manager to buy US Treasuries? And it matters not if mtgs are 4.5 percent, if they are recourse loans even the few qualified will balk. Its all a smoke and mirrors game with the end result a declining standard of living for all and massive unemployment.

 

[enter`name`here]

Interesting, they now have target "range". Look at gold soar..

 

[Cowlesy]

75bps cut to 25bps

freeeee money!!!!

 

[smithtg]

 

[enter`name`here]

75bps cut to 25bps

freeeee money!!!!

Not even 25bp. 25bp is the upper limit of the range. the lower limit is 0. Free money is right.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aWh.Nn9dXE_A&refer=home

 

[HOLLYWOOD]

DEPRESSION... WhoHoo!


"...The FED FOOLS are going to purchase SUBSTANIAL MORTGAGE-BACKED Securities!"

More money down the drain.

I hope Y'all have plenty of Gold/PMs...

The EURO is Soaring!
... Worthless Dollar tanking...

GOLD UP! $850

Markets Up... why? The dollar is dead... needs to offset the depreciation base.

DEPRESSION 2009... starring O'CHANGE and his FINANCIAL FOOLS!

 

[gonegolfin]

.​

They're already there.

12/05/2008, 0.12
12/06/2008, 0.12
12/07/2008, 0.12
12/08/2008, 0.12
12/09/2008, 0.13
12/10/2008, 0.11
12/11/2008, 0.14
12/12/2008, 0.15

Federal funds effective rate

The floor they tried to put in the overnight rates by paying the target rate for reserves didn't work.

.​

It did not work because not all institutions holding reserve accounts at the Fed are eligible for the payment of interest on reserves or excess reserves. Think of the GSEs or foreign institutions. Thus, they have more incentive to lend cheaply.

Brian

 

[gonegolfin]

The FED is destroying the money market industry, taking over the commercial paper industry and the only result is death to banks. If they lower long rates like they have the spreads will not be big enough to support our bohemoth banking industry and more unemployment will result with fewer larger and larger banks. I have no idea how stocks can go up with money managers piled into treasuries and charging fees on top of it. End result is a massively declining fund industry as well. Who wants to pay a money manager to buy US Treasuries? And it matters not if mtgs are 4.5 percent, if they are recourse loans even the few qualified will balk. Its all a smoke and mirrors game with the end result a declining standard of living for all and massive unemployment.

Money market funds are now at risk of negative yields (after expenses). Many money market funds are slashing expenses. You are correct that it is becoming very difficult for the banks and investment managers to make money in this market. Of course, the Fed is there for now offering interest on required and excess reserves.

Brian

 

[weatherbill]

this is exactly what the y want..... to swoop up failing banks......

I just hope gold does one last dip so I can get in on some more before it goes bonkers.

 

[Fox McCloud]

well, the Fed is well on-track for lowering interest rates to literally 0 by the end of January, as that one individual predicted.

remember, Bernanke has studied the Great Depression all his life, and in his eyes, the cause of the Great Depression was that the Fed did not expand the money supply fast enough or that they raised interest rates, so, in his world-view, the money supply should be increased and not decreased.

of course, he's dead wrong, and his actions are not...good...at all.

 

[HOLLYWOOD]

well, the Fed is well on-track for lowering interest rates to literally 0 by the end of January, as that one individual predicted.

remember, Bernanke has studied the Great Depression all his life, and in his eyes, the cause of the Great Depression was that the Fed did not expand the money supply fast enough or that they raised interest rates, so, in his world-view, the money supply should be increased and not decreased.

of course, he's dead wrong, and his actions are not...good...at all.

NO ONE, in the ILLEGAL FEDERAL RESERVE, US GOVERNMENT and Pandering Puppet associations (pocket Economists, newspapers and media of the 4th branch of US Tyranny) will admit to:

Inflation Helps the US Government and Banks, hurts the Taxpayers.

No will admit, the TRULY ONLY way to minimize this financial disaster is to cut TAXES!

CUT Corporate TAXES!
CUT Income TAXES!
CUT Individual TAXES!

CUT GOVERNMENT SPENDING!


NONE of THEM will Admit the OBVIOUS and BEST solutions for the American people!

Once again, well contrived scheme by Government and the Banks... at the expense of the people!

 

[Zippyjuan]

The Fed rate cuts have been pointless. They did not have a chance of having any real effect on the economy because it is not the level of interest rates which is the problem. Bernanke keeps tossing thing out to see what happens and what is happening? Not much other than a lot of taxpayer money getting handed out. It has not changed any behavior in the market other than to cause the line of businesses seeking their share of the free cash to grow. The market has to run its course. Then maybe you can apply a little stimulus and get a reaction.