SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : Currencies and the Global Capital Markets
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: hobo who wrote (2824)1/3/2001 6:04:22 PM
From: Robert Douglas  Read Replies (1) of 3536
 
I think the market's reaction to the cut was an interesting one:

The Eurodollar futures were up sharply on the near contracts but by the time you got to Dec. and 2002 they were down. I think this means that the market expects the Fed action will work since it was early enough.

The bond market tanked. This also seems to indicate that the market believes the Fed may be able to avert recession.

The dollar was strong against the euro. This could be because there was speculative money flowing back into the U.S. stock market or, like above, the market feels that the cuts are timely and will revive the economy. If recovery takes time, the dollar will have a double whammy; low interest rates and a slow economy.

I personally don't think the market appreciates the extent of the coming slowdown and think it acted prematurely by discounting a recovery after just a half point cut. I think it will take a lot more to do the trick.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News