The Fed is still behind the curve.
March 17th, 2008 at 4:25 pmLast year, January/February timeframe, I remember the talk of the rate cut that would happen in March. And if not March, definitely May. This made me smile, not just because of the stock market, but because I was getting ready to put a house on the market, and lower interest rates bring in a few more buyers.
March came and went with nothing.
May came and went with nothing.
August gave us a 50 basis point cut in the Discount Rate, and then finally in September we started seeing cuts in the Fed Funds rate.
Six months of inaction and hyperfocusing on inflation to the exclusion of everything else.
And what do we have to show for it? A Sunday night emergency rate cut, BSC being sold to JPM for $2/share for the sake of an orderly exit, and a Fed that is now in panic mode.
Maybe the next generation can at least look back at this mess and not make the same mistakes.
