- This topic has 9 replies, 4 voices, and was last updated 16 years, 7 months ago by bsrsharma.
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August 17, 2007 at 9:10 AM #9916August 17, 2007 at 2:26 PM #77167barnaby33Participant
What he basically said was, that the FED controls the market and thats why its never good to bed on the negative (in the long term.) I love how he left himself an out with, “could we see 12k, possibly.”
The FED my want to lower interest rates, but may not be able to. Especially if it actually cares about inflation.
There already seems to be a fair amount of capital flight in terms of the yen, if they cut but thats going to ramp up hard and fast. The market will take it in the shorts the end game is the same.Josh
August 17, 2007 at 2:26 PM #77289barnaby33ParticipantWhat he basically said was, that the FED controls the market and thats why its never good to bed on the negative (in the long term.) I love how he left himself an out with, “could we see 12k, possibly.”
The FED my want to lower interest rates, but may not be able to. Especially if it actually cares about inflation.
There already seems to be a fair amount of capital flight in terms of the yen, if they cut but thats going to ramp up hard and fast. The market will take it in the shorts the end game is the same.Josh
August 17, 2007 at 2:26 PM #77314barnaby33ParticipantWhat he basically said was, that the FED controls the market and thats why its never good to bed on the negative (in the long term.) I love how he left himself an out with, “could we see 12k, possibly.”
The FED my want to lower interest rates, but may not be able to. Especially if it actually cares about inflation.
There already seems to be a fair amount of capital flight in terms of the yen, if they cut but thats going to ramp up hard and fast. The market will take it in the shorts the end game is the same.Josh
August 17, 2007 at 6:10 PM #77282ucodegenParticipantAdd to the above, that the Fed has to find the financing for Congress’s deficit spending. That is finance either of two ways:
1) Printing money which increases money supply and is highly inflationary.
2) Issuing treasuries. The yield (fed rate) on the treasuries has to be high enough for people/institutions/countries to want to by it. Too low a rate, and no buyers. This means that the fed may not be able to lower interest rates very far.August 17, 2007 at 6:10 PM #77403ucodegenParticipantAdd to the above, that the Fed has to find the financing for Congress’s deficit spending. That is finance either of two ways:
1) Printing money which increases money supply and is highly inflationary.
2) Issuing treasuries. The yield (fed rate) on the treasuries has to be high enough for people/institutions/countries to want to by it. Too low a rate, and no buyers. This means that the fed may not be able to lower interest rates very far.August 17, 2007 at 6:10 PM #77429ucodegenParticipantAdd to the above, that the Fed has to find the financing for Congress’s deficit spending. That is finance either of two ways:
1) Printing money which increases money supply and is highly inflationary.
2) Issuing treasuries. The yield (fed rate) on the treasuries has to be high enough for people/institutions/countries to want to by it. Too low a rate, and no buyers. This means that the fed may not be able to lower interest rates very far.August 17, 2007 at 6:20 PM #77291bsrsharmaParticipantFed has to find the financing for Congress's deficit spending.
These two are unrelated. FED can create money. Congress can only borrow (or tax) money. There is very good reason why they should be separate. It is the U.S. Treasury (Bureau of Public Debt) that issues Treasuries (Bond, bills & notes). FED has nothing to do with it. FED issues money – your Dollar says "Federal Reserve Note"
August 17, 2007 at 6:20 PM #77412bsrsharmaParticipantFed has to find the financing for Congress's deficit spending.
These two are unrelated. FED can create money. Congress can only borrow (or tax) money. There is very good reason why they should be separate. It is the U.S. Treasury (Bureau of Public Debt) that issues Treasuries (Bond, bills & notes). FED has nothing to do with it. FED issues money – your Dollar says "Federal Reserve Note"
August 17, 2007 at 6:20 PM #77438bsrsharmaParticipantFed has to find the financing for Congress's deficit spending.
These two are unrelated. FED can create money. Congress can only borrow (or tax) money. There is very good reason why they should be separate. It is the U.S. Treasury (Bureau of Public Debt) that issues Treasuries (Bond, bills & notes). FED has nothing to do with it. FED issues money – your Dollar says "Federal Reserve Note"
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