I also say no cut. Ridicule away. One need only read your posts lately to take you in context. Besides, in the very first post here you're calling for a suprise 50bps cut. If anyone's exposed wrong, I'd say it's you.
They shouldnt lower the rates at all, but wall street will get want they want, they want .50 but will only get .25. I think they cut rates by .25. No cut and the dow falls back below 13k QUICK.
4th Qtr GDP revised to 4.9% How the hell they can cut with that is beyond me, but I wouldn't bet against GS. Gentle Ben will probably cut rates, as it will cause the least flak for him.
4.9% and the market falls, why, because now the anticpation of a rate cut of at least 50bp is fading. The economy doesnt need another rate cut, its wallstreet that wants the rate cut.
rates should go up, no q. published inflation figures are concocted and a total joke. and for how much the fed discounts People's intelligence, just look up on their website the incredibly shallow and puerile excuse it has given for ceasing to publish M3 figures. for an economy soon having to merge, for it can't be sustained by issuing and buying [trading] debt via an already soft currency yet relentlessly softened by the fractional banking system, it is not only convenient those numbers can't be seen any longer, but necessary.
The market was pressured by the claims number. GDP is yesterday's news, the quickly deteriating jobs situation is a story in the making. The market KNOWS it'll see further eases (at least .25). Doubt remains though if liquidity on it's own will be enough to offset economic weakness.
US GOVTS: What Kohn Really Said -- "easy now, we got your back. " Thursday, November 29, 2007 10:44:00 AM Boston, November 29. Is it any surprise that Fed Vice Chair Donald Kohn has all but reenacted the "Greenspan Put" as after all, he was the maestro's favored disciple as he worked his way up from Fed staff advisor to chief economist to his now esteemed position of Vice Chair. Either way, Kohn was out with rhetorical splendor yesterday morning as he addressed the Council on Foreign Relations on Financial markets and Central banking. Cutting to the chase, Kohn essentially said that the health of the markets (or systemic risk) takes precedence over the Fed's broader mandates of full employment and stable prices. And indeed, that the three directives are not mutually exclusive but rather that the smooth functioning of the markets -- an immediate concern -- is the number one priority whereas economic conditions -- growth and inflation -- can be handled with a broader macro-policy brush. This was unequivocally clear in his utterance: "The nature of financial market upsets is that they substantially increase the risk of such especially adverse outcomes while possibly having limited effects on the most likely path for the economy." Reinforcing his point he quickly dismissed the risk of the Fed introducing any moral hazard, opining that the markets had already punished the miscreants and either way that the common good far outweighed the benefits of any Fed reprisal against those who took excessive risks.He also specifically mentioned the availability and cost of credit for economic players at large and that any undue constraints here "would require offsetting policy actions." Again, a clear indication that due to the stickiness in funding (libor), the sharp widening of credit spreads, and the near freezing of the new issuance markets that the Fed will be more inclined to ease, all else being equal. For good measure, Kohn also cited the elevated turbulence reflected in various markets from equities to housing. He ended his remarks by saying "we will act as needed to foster both price stability and full employment. But keep in mind, Kohn laid out the needed prerequisite for the Fed to attend to that mandate, namely by dealing with financial market upsets. With the markets all but certain to throw a grand mal seizure if not aided by more policy ministrations, a December 11 rate cut is all but assured, if not more beyond. Markets have certainly gotten the message and jumped back into the risk pool -- stocks and credit spreads -- with the glee of a cannonball. Greenspan would be proud. "Put" that in your pipe and smoke it. The market s are to be most interested to see in Fed Chief Bernanke follows up on Kohn s sentiment when he speaks tonight (07:00) before the Charlotte Chamber of Commerce on the regional and national economies. As far as Ben is concerned, the better thinking is that Kohn echoed the Chief's thinking and that his risk-management words yesterday were seen and pre-approved by Ben. As other more hawkish FedSpeak suggests though, there is no unanimity on the Fed, which undoubtedly will make for a lively debate, if not additional dissenters, but ltimately a rate cut at the December 11 meeting. As other have suggested more policy hawks Plosser and Fisher -- are seen as joining the FOMC voting ranks come next year raising the prospect for more potential policy dissenters. This suggests to some of the more conspiracy minded that Fed Kohn and Bernanke may wish to push through their accommodative agenda while they can.