Letters to the Editor
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Federal Reserve
"The fragile psyches of Wall Street traders who played such a pivotal role in creating this mess by romping through the derivatives wonderland, are now in control of government strategy. That can't be good."
What "government strategy"? The Federal Reserve is a consortium of private banks, not a government agency. It represents private capital, not government policy. So it will always "bail out" the plutocrats on Wall street.
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wrong!!!!!
"consortium of private banks"
No.
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More rate cuts expected
One of the headlines over at CNBC is that now the market expects another 50 basis point cut next Wednesday.
http://www.cnbc.com/id/22780522
What's interesting, is on CNN this morning, the talking head gave advice to try and refinance your home right now before the resets if you still had an ARM. She at least warned people to have a realistic view of their home's worth before doing so.
I don't care if interest rates go down even farther, it doesn't make me want to rush out and buy a home in CA or an investment condo in Vegas or Miami, nor do I want to finance new furniture for my house.
Caution has set in (actually it had for a while) but now it has for my neighbors who were feeling "rich" just a few months ago. I don't see that an emergency rate cut will make them feel more confident and wnat to buy tons of new stuff.
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forget about your neighbor
This is not about us, real people. This is about injecting liquidity into the financial markets. In other words, drastically lowering margin interest for leveraged hedge funds.
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Another conspiracy theory for you...
The banks are freaking out because Bush wasn't able to deliver on his promise of "privatized" social security system. All that allegedly AAA-rated derivative crap based on subprime loans seems like it was tailor-made to be sold to the new improved social security system that never materialized. It would have been the only buyer big enough to buy such huge volumes of the stuff. Without the intended buyer, the banks got stuck holding their own bags of crap and now they're in deep trouble.
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Federal Reserve
"The system is private, conducted for the sole purpose of obtaining the greatest possible profits from the use of other people's money, and in the interest of the stockholders and those allied with them." Charles Lindberg,Sr. (1915)
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This stinks of panic to me
As someone who has saved and lived within my means I am now being penalized. The dollar will continue to drop, oil will continue to increase. The real value of my money and investments has been effectively cut.
I think at this point the real question is if the US has a cold will China get the flu, or vice versa.
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It's true
The Fed is not a government agency, and so technically is not in control of "government strategy," although lately there seems to be less and less difference between government and corporate strategy.
I assume the reason it's a separate, private entity is so that its economic stewardship would be free of political influence. (Heh.) Regardless, today proves it certainly doesn't have the best interest of the American people in mind.
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the labrythine Fed
Every once in a while, I try to figure out how our banking/currency system works, and I typically end up as confused as when I started. The comments in this thread indicate that others are just as confused as I am (even if they don't admit it).
But I have to wonder how anyone considers Charles Lindberg (an airplane pilot living in 1915) to be an expert on the nature of the bank as it exists today.
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Congress Must Act
This economy is dead in the water unless the legislature undertakes the following three actions: a) permanent extension of Bush tax cuts b) elimination of confiscatory inheritance tax c) authorization of Bush's plan for aerial bombardment of Iran.
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We could just vote for Ron Paul
Not. I'm no fan of the current rate cut. It clearly seems like overreaction to the current market, but at the same I will acknowledge the market matters. The great depression may have been softened and quickened had the Fed reacted quickly. Bernanke is a student of the great depression, and I'm willing to give him some room to prove that he's not beholden the wall street masters.
Also for the housing mess, I hardly think we can just blame the trader's and their derivatives. There is plenty of blame to go around. Everyone is suffering from their own greed. Traders with the securities they can't sell. Consumers with too much house. Banks holding onto mortgages that won't get paid back.
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Federal Reserve
"But I have to wonder how anyone considers Charles Lindberg (an airplane pilot living in 1915) to be an expert on the nature of the bank as it exists today."
Charles Lindberg Sr. was a U.S. congressman at the time of the founding of the Federal Reserve and father to the "airplane pilot".
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@keroseened
"...a) permanent extension of Bush tax cuts..."
Yeah, because what we're going through right now proves beyond the shadow of a doubt that giving more money to wealthy people is good for the country.
</sarcasm>
As far as I can tell, the more money those clowns have, the faster they can wreck the country.
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wrong!!! again!!!
Well that fascist Lindberg was certainly entitled to his opinions. As to the fact that US banks own stock in regional feds, this hardly qualifies as 'private' in the usual sense. So please mothball the paleo-left wing conspiratorial rhetoric about the dark motives of grubby financiers.
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Heckuva Job, Benkie...
Everyone should take a deep breath and then read Chapter 13 in Bob Prechters, Conquer the Crash. "What actual path the Fed with take under pressure, is unknown, but is important to to know that under no obligation to save the banks, print money, or pursue any other rescue. It's primary legal obligation is to provide backing for the nation's currency..."
At the recent Senate testimony, Bernanke said, emphatically, that the dollar was not his responsibility, that the Treasury Department was in charge of that.
Now what is the Fed? Another political cabinet position, that's all. This is the US government intervening in the free markets, to influence prices. But that shouldn't surprise anyone who has watched the Bush administration now for seven years?. How is the economic market surge going to turn out? How will the blame game play out? Heckuva Job, Benkie?...