A Game-Changing Crash . . . .

[jazz]

Fed has chips all on-the-table . . . feels like Custers Last Stand.

Can't they go negative or hand out cash like China did in HK? Devalue currency, start rapid QE again?

I always think the jig is up and then they come with some scheme to keep it all going.

[agstar77]

The Trump slump is alive and well. We will see if market breaks through last weeks lows.

[errolanderson]

Emergency rate cuts are rarely good news. Here's a track record . . . .

March 2001 Tech Bubble . . . 1/2% cut
August 2007 Subprime Mortgage Fiasco . . . 1/2% cut
January 2008 Stock Market Crash . . . 3/4% cut
October 2008 Lehman Bros Collapse . . . 1/2% cut

[agstar77]

WH is calling for bigger cuts. All this is doing is re-enforcing the seriousness of the situation.

[AlbertaFarmer5]

The Trump slump is alive and well. We will see if market breaks through last weeks lows.

Is this the Trump slump?


Political affiliation is odd, where else do people actively wish for financial ruin, death from disease, war, and any other calamity, just so they can blame it on a politician they dislike?

[fjlip]

Or the CLIMATE jumping up a few degrees and destroying the planet...any dooms day is welcomed by the left

[Austrian Economics]

The broad markets did not care for the Fed's emergency rate cut; thus the rally petered out. It's not that the markets are saying that the Fed should not have cut rates, but rather that the rate cuts are not sufficient to give relief to the debtors. The 10 year treasury yield has been falling since November, long before Coronavirus. While the central bank controls the very short end of the yield curve, the rest is determined by arbitrage in the credit markets. The reason that yields are falling is because business demand for capital is also falling. When your margins are being crushed, there's no room for borrowing. All the Fed can do is keep cutting until the yield curve gets back to a normal slope. It will take negative rates on at least the short end to do it.

[jazz]

There is a rumour floating on the interwebs that the US will attempt a return to a partial gold standard, part fiat and perhaps some sort of crypto blockchain backing.

Supposedly Fort Knox has 250,000 tons of gold which is 10 times more than the next country. They are the only ones that could attempt it.

But when they do, whats in your wallet will be virtually worthless.

There has to be a plan in the works. The end of fiat cant be dystopia.

[shtferbrains]

Emergency rate cuts are rarely good news. Here's a track record . . . .

March 2001 Tech Bubble . . . 1/2% cut
August 2007 Subprime Mortgage Fiasco . . . 1/2% cut
January 2008 Stock Market Crash . . . 3/4% cut
October 2008 Lehman Bros Collapse . . . 1/2% cut

Gives the savvy high rollers an exit opportunity?

If you know the pump is coming your golden.

[errolanderson]

The broad markets did not care for the Fed's emergency rate cut; thus the rally petered out. It's not that the markets are saying that the Fed should not have cut rates, but rather that the rate cuts are not sufficient to give relief to the debtors. The 10 year treasury yield has been falling since November, long before Coronavirus. While the central bank controls the very short end of the yield curve, the rest is determined by arbitrage in the credit markets. The reason that yields are falling is because business demand for capital is also falling. When your margins are being crushed, there's no room for borrowing. All the Fed can do is keep cutting until the yield curve gets back to a normal slope. It will take negative rates on at least the short end to do it.

Not sure how the yield curve will get back to normal. Ten-year treasuries now all-time low below 1 percent. Fed making emergency cut just panicked market. There’s just not a good ending as the financial ghost of 2008 Lehman Bros are again haunting financials.