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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: ild who wrote (8957)2/29/2004 1:54:55 PM
From: CalculatedRisk  Read Replies (1) of 110194
 
ild, you are probably right about the ECB not cutting this week (it is possible). But I do think it is now more likely that the ECB will cut in the next few months.

My main point is that the Fed is not out of ammunition. They can (and my guess is they will) intervene in longer term instruments if the economy continues to weaken.

I do not think the Fed has intervened yet in longer term instruments. My guess is, if they do intervene, they will announce a target like they do for the Fed Funds rate.

If your scenario, of a weakening housing market starting to take down the economy, comes to play (something I agree with), than I think the Fed will move to reduce rates.

Best to you!
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