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Strategies & Market Trends : Galapagos Islands

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To: Jorj X Mckie who wrote (42889)	6/25/2003 2:46:23 PM
From: Lazarus_Long	Read Replies (1) of 57110

LOL! This sucker was an easy call. The Fed wasn't not going to cut 1/2 point. They are almost out of ammo- -now we're down to 1%. That gives them only 4 1/4 pt cuts or 2 halvies. They have to conserve their ammo at this point. Both bonds and stocks had priced in between 1/4 and 1/2 point- -there are always optimists out there. Now both have to give back the excess over 1/4 point. A recent Business Week article (not a particularly good rag) had an article on these low rates. They basically said that the Fed was now in danger of inducing bubbles in the economy. This can already be seen in RE. I think the Fed really wants to induce a new stock bubble. The danger comes on the other side when inflation starts and the Fed has to raise. Then it gets serious. CNBC trying to put a positive spin on the 25 beeps- -"The Fed didn't have to cut more because the economy is doing OK."

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