Again the Fed refuses to do the obvious! They should not risk the "Moral Hazard" of bailing out corporations while not doing the same for Joe Q Sixpack! So - they should let the distressed mortgage holders clean out their closets and garages of old junk, and let them bring it all to the discount window. There the Fed will exchange their "treasures" for cash. The homeowners will no longer be distressed! They will use the cash to pay back their mortgages, the lenders will be made whole, and confidence restored to the financial system! If the Fed doesn't do this, are they saying that "Moral Hazard" is only for the little people? Or that these financial institutions have no morals anyway - so no threat of any "hazard" there?
I just dont understand how everyone is so sanguine about what the fed did this week. Bernanke just made an 800 billion bet with our money. God help us all if he's wrong. I've never been a gold bull but I think this weeks move down was the biggest headfake in history. When people really absorb the potential consequences of that madmans actions gold might really go parabolic.