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The intermeeting rate cut is back on the table ... maybe --->>

Friday, March 07, 2008

There's been a survey in the sidebar for a little while now about an intermeeting rate cut and it was about to be taken down until Dallas Fed President Richard Fisher showed up on Bloomberg just a little while ago. Here are the results to date:
The next FOMC meeting is on March 18th and the current tally stands at more than two-to-one in favor of another "emergency rate cut". That sounded like a good bet two weeks ago, but not so much in the last ten days - that is, until yesterday.

The headline for the Bloomberg interview read:

"Fed's Fisher Downplays Speculation of Emergency Rate Cut"

And, of course, there's a story on the same subject. Since they're talking about an intermeeting rate cut at all now (well, the plunging stock market may be somehow involved), it seemed like a good idea to leave the survey up for a while longer - it's even been moved up on the right sidebar for easier access.

Here's the Bloomberg interview:

Click to play in a new window

Geez, I don't know about you, but just watching this gave me the willies - something about it being important that the Fed keep a level head under emergency circumstances, after which the interviewer said, "Really? Are we in an emergency right now?"

Sorry, but if you've already voted, you can't vote again unless you access the survey from a different computer.

Hmmm... maybe not. I just voted again and it accepted my vote. Apparently you can vote again if sufficient time has elapsed between your votes.

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Anonymous said...

Six to one in favor of no rate cut since you posted this? These people obviously aren't watching equity markets. Mine was the only new vote for an intermetting cut? Wake up people!

Tim said...

Anon, I think you're right. On a year-to-date basis, the Dow is now down 10.3 percent, the Nasdaq is down 16.6 percent, and the S&P 500 is down 11.9 percent. I was surprised to see them all pop up as double-digit red numbers.

little larry sellers said...

Now it's 7 to 2 in favor of no cut since Tim's posting. Forbes raised the possibility of an intermeeting cut today: "Lowering interest rates between 50 and 75 points at the next meeting on March 18, if not beforehand, would calm the jittery credit and equity markets".

I think the Fed was really hoping for good February jobs news, but instead saw 63,000 lost jobs. That, coupled with Wall St being hammered the last few days, could prod the Fed into action before the 18th.

Anonymous said...

now 15 to 11 in favor of a cut before the 18th

staghounds said...

That's what you get for buying your poll software in Chicago.

The 18th is prettty close, suspect they'll wait until then.

Anonymous said...

One would hope The Fed is able to come to terms with accounting in regard to FASB 157 and 158, both of which were delayed last year. These FASB accounting issues are related to mark-to-market disclosure and valuation.

The collateral transfers in question here are simile-like, i.e, we have corporations dumping toxic waste into our drinking water, while The Fed lowers the parts per billion accountability levels.

The Level 3 mark-to-market accounting is to help us plain farm folks understand more about the derivatives and behind the scenes illusions, e.g, Level 3 speaks of unobservable assets, which need to be valued at current market rates. Why then, as citizens of America are we being placed in a position where accounting rules are not being used, not being implemented or used to help strengthen our economy. It seems to me, this is a matter of National Security, and if we allow a bunch of crooks to keep dumping toxic junk into our system, we will all be impacted by the insidious nature of this cancer!! Get real, these crooks need to go to jail and we need to see people in this government resign for contributing to false and misleading information and fraudulent accounting practices!!

Anonymous said...

OT, but please pass along!

Tajikistan 'facing food crisis'

Tajikistan is in the grip of emergency food shortages, the UN's World Food Programme is warning.
The deteriorating food situation is part of the energy crisis which hit the mountainous nation in the middle of its coldest winter for five decades.

Tajikistan is currently using up its last energy resources, and it may face a total blackout.
The Christian Science Monitor, neweurasia, and other media observers are predicting that a nascent hunger crisis will erupt into a full famine as a consequence of the energy shortages.
An international appeal has been made by the United Nations, NGOs, and the Red Cross and Red Crescent for around US$25 million to assist the government. According to the United Nations, more than two million people could face starvation before the end of winter.

Anonymous said...

There will be no cut, as the fed is trying to ensure the dollar will have a "controlled descent". It is still in deep doo-doo as a currency, but another emergency rate cut will just be like adding blood to a feeding frenzy of dollar bear sharks.

little larry sellers said...

Another Reuters article appeared today, warning not to rule out an intermeeting cut. Even with no intermeeting cut, they predict 50 bps cuts at the next two meetings:

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