They can, but they haven't.
Any thoughts as to why exactly they have not?
Why hasn't the Fed cut rates?
Started by
TTHQ Staff
, Sep 29 2008 11:28 AM
10 replies to this topic
#2
ken29
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Posted 29 September 2008 - 11:31 AM
cuz they don't want the mkt to rally until the bill is passed 
#3
qqqqtrdr
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Posted 29 September 2008 - 11:34 AM
Fed cuts rates to lower interest rates for businesses and consumers. The problem is that when they cut rates down to 2% the banks were under water, and it only kept banks from not increasing interest rates. When the government buys back loans it should lower the interest rates on the loans that banks give out.
Barry
#4
TTHQ Staff
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Posted 29 September 2008 - 11:36 AM
Brilliant assessment, Ken.
ah, futility..... we will all be assimilated.
ah, futility..... we will all be assimilated.
#5
traderpaul
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Posted 29 September 2008 - 11:50 AM
I have the most powerful hand gun in the world, I lost my count of how many bullets I used. Do you feel lucky? Well, do you?
"Inflation is taking place now. Prices may not appear to be rising because they are making packaging smaller. "— Rickoshay
#6
fib_1618
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Posted 29 September 2008 - 11:58 AM
They actually have since September 19th...the daily effective rate as of last Friday is at 1.08% at the overnight desk.They can, but they haven't.
It's also worth considering that any target adjustments really don't have any direct effects to the equities markets for many months, and where their current agenda is to stabilize the patient before introducing any rehabilitation programs towards a full recovery.
Fib
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#7
humble1
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Posted 29 September 2008 - 11:59 AM
because rate cuts won't help or matter much in this environment. if they did, then the historic recent drop in rates to 2% would have made a differnce.
the problem is not liquidity but solvency. this is a hugely important issue and one which seems not to be widely understood.
they probably will cut, but rates down to zero will not help much/any. think japan.
#8
traderpaul
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Posted 29 September 2008 - 12:04 PM
Question for you Dave (fib).....Was the stimulus a mistake?
"Inflation is taking place now. Prices may not appear to be rising because they are making packaging smaller. "— Rickoshay
#9
TMN
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Posted 29 September 2008 - 12:09 PM
how about the USD will go to hell today rather than slowly but steadily if they cut rates?!
#10
humble1
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Posted 29 September 2008 - 12:15 PM
another reason is that they plan to start paying banks interest on reserves held at the fed. i think that means they will pay the fed funds rate. of course, all these things are centered at helping banks. that is the problem with this focus.
and the banks have screwed so many people for so long that no one really wants them helped. besides and most important, helping banks is STILL PUSHING HARDER ON THE STRING!
can these people be THAT STUPID?
YOU BET THEY CAN!
