market still up for year and people want cuts? bullshit rate cuts must be saved for down 20% or more. the fat cats begging for rate cuts to save there own skin while saying it needs to be cut for the small guy
Silk has been around the block and knows his stuff. He is right, a rate cut is crucial now. It's not a matter of bailing out the stock market. The credit markets, which are far more important, have stopped functioning. If you don't understand what I'm saying, look up the rates on jumbo mortgages. Basically, lenders don't want to loan money because they know they can't pass the paper on. How long before it hits the rest of the credit markets? It's happening now. What you will see is basically any sector that depends on securitizing consumer loans go out of business. Housing, autos, retail, even student loans. Should make a nice backdrop for the '08 elections.
I'd have thought the problem you've laid out is textbook perfect for a pure market solution. Indeed, an exemplar for the business school syllabus. Won't (more) gov't intervention merely muck it up?
Fed just needs to step in and make some positive comments (which are truthful of course) and that will bring some calm to the credit markets. Right now credit tightening is based on fears not phyical lack of capital. Fears subside, the money will flow. Fed job is to ease fears if it can do so truthfully which does not necessarily require a rate cut.
there has never been a "free market"! It`s just a term used to support a given agenda, and used conveniently when it suits certain agendas and perspectives. IT`S ALL ABOUT FIGHTING OVER POWER, THE WILL FOR POWER -- NEITZSCE.
Well said. Shit goes up, shit goes down..er, actually shit only goes downhill but you know what I mean.. Let's party like April, 2000!!
Absolutely my good man. Nice to be on the right side of this mess. Too bad everybody can't be. Then it wouldn't be a mess would it? Is it their fault they decided to be somebody? Of course not, so I have some sympathy, but not nearly enough to hand back profits merely in the name of quelling fear. By "they," I mean the whole lot: the overreaching home buyers, the real estate promoters, HF investors, sheeple stock buyers, mortgage brokers, stock touts, and the Wall Street cons who -- as is true always -- made it all possible.
When housing prices decrease some more, jumbo loans won't be so necessary, because there won't be many places that require non-conforming paper.