Monty, re:Fed Funds, Discount Rate, etc
Well, I shouldn't pop-off after that horrendous candles call on Tuesday evening. <g> Luckily, I'm flat this week with refusal to swim in such waters.
AG and co., will do what's necessary to reduce cost of money to lending institutions, resuscitating profitability. So far as domestic economic expansion, liquidity is already being poured into the system. Global problems? There's are separate campaigns for this cause, and I don't see AG (or his management) folding.
Trouble is that 'bad debt' is the root of the problem, fueled by over-speculation and excess liquidity. Of course, we know this... and we know that further loosening will only encourage more speculation. AG's between a "rock and a hard place," but he knows who signs his paychecks. This leads me to believe that we are not at the speculative peak, and therefore have further upside in the market over the coming weeks.
Amazingly, the same TV heads that proclaim "money must find a home..." are saying that a rate cut is essential to continued growth. Nonsense! Fan the competitive flames for higher returns. <g>
Your contrarian indicator,
Alan
ps. There appears to be a classic case of re-coinage in Western Europe. It may not materialize, but if it does... What happens if old coin is retired too early, or allowed to persist too long? How will the FED and US banks handle any USD accountability (aka, float) issues? Not the best time to be swimming in liquidity. |
