if fed cuts 25 bps, stocks down, treasuries up is the knee jerk reaction short term after that I have no idea
.50 is baked in right now I believe. I won't be surprised if the scumbags do an unprecidented back to back .75 though especially if the markets dump early in the week. It's absolute BS to do such a thing but a remote possibility just to get bulls all warm and fuzzy. The scumbags are cutting to 2% this year no doubt. They might as well get it done quickly. Just creating a brand new credit bubble. I look forward to next year when there will be surprise rate hikes when there are no more rates to be cut and this backfires on the economy. Just have to trade with flow...for now. At least the ECB has a pair of balls.
ECB def. has a set of balls, FED is however trying to prevent a massive recession in an election year.
No, not a recession in an election tear. (sarcasm). No Ben, higher inflation is a lot better. Ben keep those Dem's out of office!
The main reason I think the Fed will cut by .25 is because that will disappoint, confuse and piss off the maximum number of people - and that's what this Fed is good at. I hope they prove me wrong.
I agree with about 90% of what you're saying but, I'm thinking if the market hadn't already been weak as a kitten, SocGen and whoever else was selling wouldn't have have been able to kick the Dow futures down by 620 points by Tuesday morning. I agree, though, it certainly complicates things for the Fed this week.
What you're saying is what's ridiculous. 400bp higher? It's of course correct for the Fed to address inflation but chopping equity prices in half and stomping the economy into the dirt until we're practically back to a barter economy, which is what your prescription would do, is no solution.
I thought 25 was a foregone conclusion...whatever, the market looks ready to roll over. Perhaps, no cut will surprise everyone into believing "the ecomony is rosy"