Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

[Sapiens]

The statement by the FOMC:

http://www.bloomberg.com/apps/news?p...Ays&refer=home
FOMC Statement on 0.75 Percentage Point Decrease in Key Rate
Jan. 22 (Bloomberg) -- Following is the Federal Open Market Committee's statement on its decision to lower the target rate for the federal funds rate.

The Federal Open Market Committee has decided to lower its target for the federal funds rate 75 basis points to 3-1/2 percent.

The Committee took this action in view of a weakening of the economic outlook and increasing downside risks to growth. While strains in short-term funding markets have eased somewhat, broader financial market conditions have continued to deteriorate and credit has tightened further for some businesses and households. Moreover, incoming information indicates a deepening of the housing contraction as well as some softening in labor markets.

The Committee expects inflation to moderate in coming quarters, but it will be necessary to continue to monitor inflation developments carefully.

Appreciable downside risks to growth remain. The Committee will continue to assess the effects of financial and other developments on economic prospects and will act in a timely manner as needed to address those risks.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Charles L. Evans; Thomas M. Hoenig; Donald L. Kohn; Randall S. Kroszner; Eric S. Rosengren; and Kevin M. Warsh. Voting against was William Poole, who did not believe that current conditions justified policy action before the regularly scheduled meeting next week. Absent and not voting was Frederic S. Mishkin.

In a related action, the Board of Governors approved a 75- basis-point decrease in the discount rate to 4 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of Chicago and Minneapolis.

Now we need CONgress to rush the Stimulus Bill to the President, we wouldn't even need to wait for the Prez' signature to dry before the Banks would be "recapitalized" to start making new loans.

ONCE THE BILL IS APPROVED WE MUST BE VIGILANT TO WHERE THE BANKS ARE GOING TO BE MAKING THOSE NEW LOANS!!!

Our bets so far, Alt-energy and Infrastructure.

[Sapiens]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

http://online.wsj.com/article/SB1201...googlenews_wsj

Paulson Makes Push
For Stimulus Measures
By MAYA JACKSON RANDALL
January 22, 2008 8:17 a.m.

WASHINGTON -- Treasury Secretary Henry Paulson said Tuesday he is optimistic that the Bush administration can work with congressional leaders to quickly enact a temporary fiscal stimulus package this winter.

On Friday, President Bush put forward the broad outlines of a stimulus plan of around $150 billion that would include tax cuts for individuals and businesses.

"I am optimistic that we can find common ground and get this done long before winter turns to spring," Mr. Paulson said in prepared remarks Tuesday, noting that he has had very positive discussions with Republican and Democratic leaders on Capitol Hill.

Sign up for our new email of the day's Real Time Economics posts, by Greg Ip, Sudeep Reddy and the Journal's economics team. The email also includes the latest economic headlines, data and columns. Choose HTML or plain text.He added that it's important that measures meant to boost the economy be enacted very quickly.

Immediate tax relief for income taxpayers and incentives for businesses to invest and hire are often effective in creating growth and jobs in the near-term, he said.

"By working together, we can disprove the old Washington axiom that partisan politics prevents most short-term growth packages from being enacted fast enough to do any good," said Mr. Paulson. He reiterated that legislation should be "swift, robust, broad-based and temporary in order to be effective."

A package that falls short of approximating 1% of gross domestic product won't be effective, he said. "I look forward to engaging intensely with the Congress to get money into our economy quickly," he said.

Copyright © 2008 Associated Press

Alright!!! We are on the ball!

[grapejelly]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

no, you haven't heard about the deflation. There is NO WAY that there will be inflation. There will be deflation. Consumers and businesses won't borrow money regardless. The helicopters will dump money but it won't do any good. The money will relentlessly appreciate just like it did in Japan.

There is NOTHING to stop the appreciation of the value of all currency. This is a DISASTER. DEFLATION is impossible to stop. It will be as bad as it was in the deflationary Great Depression. Brother, can you spare a dime so I can buy a coffee plantation?

[touchring]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

wait, so no more $1000 gold?

no, you haven't heard about the deflation. There is NO WAY that there will be inflation. There will be deflation. Consumers and businesses won't borrow money regardless. The helicopters will dump money but it won't do any good. The money will relentlessly appreciate just like it did in Japan.

There is NOTHING to stop the appreciation of the value of all currency. This is a DISASTER. DEFLATION is impossible to stop. It will be as bad as it was in the deflationary Great Depression. Brother, can you spare a dime so I can buy a coffee plantation?

[FRED]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

no, you haven't heard about the deflation. There is NO WAY that there will be inflation. There will be deflation. Consumers and businesses won't borrow money regardless. The helicopters will dump money but it won't do any good. The money will relentlessly appreciate just like it did in Japan.

There is NOTHING to stop the appreciation of the value of all currency. This is a DISASTER. DEFLATION is impossible to stop. It will be as bad as it was in the deflationary Great Depression. Brother, can you spare a dime so I can buy a coffee plantation?

Someone hasn't been paying attention. Here's the iTulip version:

There is NOTHING to stop the depreciation of the value of all currencies. This is a DISASTER. INFLATION is impossible to stop. It will be as bad as it was in the previous 18 inflationary periods in the past century when nations' money systems were not operating on a gold standard and thus there was no limit to the expansion of central bank balance sheets. Brother, can you spare a gold coin so I can buy a coffee plantation for $100,000?

[grapejelly]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

Your chart is a BRIC short of a CDO...

[Sapiens]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

no, you haven't heard about the deflation. There is NO WAY that there will be inflation. There will be deflation. Consumers and businesses won't borrow money regardless. The helicopters will dump money but it won't do any good. The money will relentlessly appreciate just like it did in Japan.

There is NOTHING to stop the appreciation of the value of all currency. This is a DISASTER. DEFLATION is impossible to stop. It will be as bad as it was in the deflationary Great Depression. Brother, can you spare a dime so I can buy a coffee plantation?

gj, where is your imagination? Sovereign bonds, PM's, equities, are just tools, laboring people are who create wealth.

In our case, we are watching for the opportunity where the new "money" is going to go. Those new bank loans are going to be guaranteed by the Gov., so the banks will be insulated anyways.

The $800/$1600 check the sheeple will get, will come from a Gov. bond that will be monetized by the banks X10, X20, ????? times.

The question is, where will you be, making wealth or rotting away in recession?

[Sapiens]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

http://www.bloomberg.com/apps/news?p...USE&refer=home

Bush Open to Larger Economic Stimulus Package (Update1)

By Roger Runningen

Jan. 22 (Bloomberg) -- The Bush administration today left the door open for a larger stimulus package than the $150 billion plan the president already has announced to avert a recession.

``I've not heard anybody suggesting larger than 1 percent, but that doesn't mean, behind closed doors in their negotiating discussions, they aren't bringing that up,'' White House press secretary Dana Perino said.

Perino spoke just after the Federal Reserve reduced its benchmark overnight lending rate by 0.75 percent to 3.5 percent. The Fed acted ``in view of a weakening of the economic outlook and increasing downside risks to growth,'' policy makers said in a statement.

Perino said enactment of an economic stimulus plan would take ``weeks, not months.'' She refused to comment directly on the Fed's decision or the declines in financial markets.

President George W. Bush has ``absolute confidence'' in Federal Reserve Chairman Ben S. Bernanke, and while ``clearly there is a slowdown,'' the administration isn't forecasting a recession, Perino said.

Almost half of the world's biggest stock indexes fell yesterday as mounting concern about a U.S. recession dragged down banking and retail shares across Asia, Europe and Latin America. U.S. stocks tumbled the most since September 2002 today following yesterday's holiday.

Monitoring Markets

Bush got a briefing from Treasury Secretary Henry Paulson on global financial markets by telephone about 3:15 p.m. yesterday, Perino said.

Bush has proposed a fiscal-stimulus plan amounting to as much as $150 billion, or about 1 percent of the gross domestic product. It may include tax rebates to low-and middle income people and tax breaks for business. The president believes the amount he outlined is ``the right amount,'' Perino said.

``It has to be robust enough to have an impact,'' she said. ``That's our starting point,'' adding that she ``won't close any door'' to something larger.

Bush is scheduled to meet with lawmakers on the proposal this afternoon at the White House. Democrats and Republicans in Congress have voiced support for action to prevent the economy from slipping into a recession.

To contact the reporter on this story: Roger Runningen in Washington at rrunningen@bloomberg.net

Last Updated: January 22, 2008 10:43 EST

[Andreuccio]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

ONCE THE BILL IS APPROVED WE MUST BE VIGILANT TO WHERE THE BANKS ARE GOING TO BE MAKING THOSE NEW LOANS!!!

Our bets so far, Alt-energy and Infrastructure.

How fast do you think we'll need to react? This post makes it sound like the move will be close to immediate. Do you think a few hours, or even a couple of days, will make a huge difference?

[Sapiens]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

How fast do you think we'll need to react? This post makes it sound like the move will be close to immediate. Do you think a few hours, or even a couple of days, will make a huge difference?

Andreuccio,

When policy is involved we deal in months, sometimes in weeks or days. The point is to know where the "law" is being anchored. Why re-invent the wheel, just follow the money, through the policy.

[jimmygu3]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

no, you haven't heard about the deflation. There is NO WAY that there will be inflation. There will be deflation. Consumers and businesses won't borrow money regardless. The helicopters will dump money but it won't do any good. The money will relentlessly appreciate just like it did in Japan.

There is NOTHING to stop the appreciation of the value of all currency. This is a DISASTER. DEFLATION is impossible to stop. It will be as bad as it was in the deflationary Great Depression. Brother, can you spare a dime so I can buy a coffee plantation?

GJ,

As I read this I thought you were being facetious, but it appears from your later replies that you really believe this. The reason a dime bought a lot in the '30s was because it was made out of silver. Likewise, dollars were backed, ostensibly, by gold. Today's money can be minted and printed at the whim of the government, who has sworn to keep dumping the stuff until nominal prices of financial assets continue their eternal rise.

Japan is the opposite of the US in two ways. First, they are creditor/exporters and we are debtor/importers. They chose to protect the reputation of their currency at the expense of economic growth. Our currency is depreciated and nobody seems to mind, at least in the MSM. Secondly, the Japanese people have been told for decades that it is their patriotic duty to save and we have been told our duty is to spend. It is our manifest destiny to consume.

I think the $800 checks are going to look like a drop in the bucket compared to the money drops we are going to see in the coming years.

Jimmy

[Sapiens]

Congress on the Clock for Stimulus

Congress on the Clock for Stimulus

...


Before the meeting with Paulson, Pelosi said the stimulus was an "urgent matter to deal with." Paulson called it "something we can hopefully get done quickly." And Senate Majority Leader Harry Reid (D-Nev.) said he'd like to have a bill done before Congress leaves town in less than a month for its President's Day recess, the week of Feb. 18.

...

[jimmygu3]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

OK, I just made the mistake I have seen others make in the past on iTulip: taking someone too seriously. Yes, of course the guy who's avatar is a cartoon of Helicopter Ben was being facetious. My bad.

Jimmy

[grapejelly]

Re: Fed Cut by 3/4 Points, Now come on Stimulus Package!!!

OK, I just made the mistake I have seen others make in the past on iTulip: taking someone too seriously. Yes, of course the guy who's avatar is a cartoon of Helicopter Ben was being facetious. My bad.

Jimmy

well, for another dime, I'll sell you half my coffee plantation and still make a 100% profit.

We may have to wait a few months until the deflation goes that far but I'm assured it is just around the corner. FRED's chart made that very clear.