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Politics : Welcome to Slider's Dugout
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To: SliderOnTheBlack who wrote (2493)9/28/2006 10:14:33 AM
From: SargeK  Read Replies (1) of 50507
 
SOTB <<<1. What "one thing" would make the Investment Banks more money than any other economic event, or act (dwarfing what they've made both long and short in commodities)?

2. What needs to happen to the economy, to the financial markets and in the geopolitical picture -- for that to happen?>>>

The one thing that comes to mind is for the FOMC to unexpectedly LOWER the Fed Funds Rate 100 basis points at their next meeting with signals for further decreases.

With current prime at 8.25% and forecast to 8.5% a sudden reversal of fed actions/intentions would shock the markets.Two of the prime indicators of a recession next year (inverted yield curve and weakness in the housing and refi markets) would be immediately effected and may prolong the inevitable for a couple of more years.

The choice between fighting inflation and economic stimulation favors the latter. FWIW

SargeK

Slider, Do I get 5 stars or a 5 lashes with a wet noodle for my response? <VBG>
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