11 replies to this topic

[BigBadBear]

republican as he has some very good contacts

[redfoliage2]

republican as he has some very good contacts

A rate cut could be announced as soon as 8 am Friday.

[raleigh]

A rate cut so soon? What's the resulting mania/bubble going to be this time? Gold?

[pdx5]

Exactly, that is just what we need, more cheap credit!! One credit bubble is never enough, a pair of credit bubbles will look much better !!! You see, when a dope addict can't get a fix, the best cure is more dope!!! Or when an alcoholic is out of booze, why not give him another bottle of wine??? Sure makes so much sense!!! <Sarcasm ends>

[Citation]

An emergency rate cut would surely spook people and may have the opposite effect.

[ogm]

This isn't about cheap credit. Fed must stabilize the financial system. Its their job. And that is exactly what they will do. If they allow system to come unglued and shatter the confidence of market participants, it may have very long reaching consequences. And the stabilization of the system requires that they provide cheap credit now to let people refinance out of bad housing loans and stabilize real estate. As simple as that. All risks are now on the upside.

Edited by ogm, 28 August 2007 - 05:56 PM.

[pdx5]

I have to agree with Citation that a panic induced rate cut would look extremely spooky. Actually there is no instability in the financial system, just the speculators and hedgehogs are getting burned. There is plenty of credit available to those who can truly afford it. Majority of US corporations have strong balance sheets and very good profit margins. IBM has no problem selling bonds. Neither does GE. I believe some of the Fed's duties are to stabilize the currency and provide capital to cover the deficits. How is the dollar going to survive with emergency rate cuts? How will inflation be affected when the beaten up US$ buys imported goods at higher prices? I hope the Fed is not that stupid. I hope Bernanke has less itchy fingers than Greenspan, the father of this credit bubble. The Fed needs to have foreign customers willing to keep buying US Treasuries to cover the federal deficit spending.

[toni]

Anything now that will bail out the hedge funds, speculators, or other unsavory charectors who try to make a living as sharpshooters trying to put their hustle on the economy would be a disgrace. If all of these people were simply put in a sack and dropped in the oceon, lake, or river the way unwanted cats are the world would be a better place. A serious long term investor who just ignores all of this and continues putting his money in his 401K each month will be unaffected by this. When he is ready to retire 10 or 20 years down the road all of this will not be even a bump in the road. toni

Edited by toni, 28 August 2007 - 06:48 PM.

[pdx5]

Anything now that will bail out the hedge funds, speculators, or other unsavory charectors who try to make a living as sharpshooters trying to put their hustle on the economy would be a disgrace. If all of these people were simply put in a sack and dropped in the oceon, lake, or river the way unwanted cats are the world would be a better place. A serious long term investor who just ignores all of this and continues putting his money in his 401K each month will be unaffected by this. When he is ready to retire 10 or 20 years down the road all of this will not be even a bump in the road.

toni

Actually, those who fund their reitement plans every month will MAKE MORE MONEY
when the market sags periodically during the years of their contributions because they
pick up more shares for the same amount of $$.

[toni]

Thats right pd+5, The only thing that counts for them is the prices when they retire. And as for those close to retirement their asset allocation should be 50-50 stock-bonds. Those in retirement should be 40-60 stock- bonds. And with 50 to 60% in bonds they did not do too bad today. Bonds had a very good day. Their portfolio probably still lost a little, but the result should have been well witthin their risk tolerance. They can also just ride this squal out. For the most part the only ones who are getting hurt are the ones who deserve to get hurt. Risk is real & must be planned on. toni

Edited by toni, 28 August 2007 - 08:53 PM.