well if they want joe six pac to keep buying walmart goodies, he'll give joe six packs employer a nice christmas rally.
Joe, The summer of 2005 was the peak of the housing boom and it was also the peak sales of the sub-prime loans. Most sub-prime loans have a life of 5 years. Summer of 2005 to the Summer of 2010 is 5 years. Housing will start recovering in mid 2010. Jeff
Why would the Fed act today? Sorry I did not follow your logic? Oh, I get it, because the Dow went down few hundred points and now some small wanna-be-Tudors, such as you, need to be bailed out? Guess you slightly misunderstood the function of the Fed. Here we go....http://www.federalreserve.gov/
Perhaps you missed the last month or so. Bailing out the markets is exactly what the Fed did, regardless of what the function of the Fed was supposed to be.
I really do think you misunderstand. Nobody bailed out the market. The Fed could not care less where the market is trading. Maybe your favorite newscasters on CNBC like to spin it as such but nothing could lie farther from the truth. Fact is the Fed has not lowered interest rates much earlier because inflation was a persistent threat. This threat has drecreased by much, so much that the threat comment even disappeared in the same wording it was in the Fed notes before. The Fed is concerned with the overall economy and not whether the Dow traded down 2000 points. If more subprime issues surface (which they will I am sure) and there will be more pain in the housing market then this is of concern to the Fed, BUT NOT that some equity index is showing more than usual volatility. I hope you get it the second time around. Of course market corrections to the downside are somewhat correlated with issues in the real economy but this was not the question.