Did Bill Poole royaly F*** up?

[blazespinnaker]

Talking strongly about rate policy during a deep market crisis - that has to be listed as one of the all time biggest mistakes a Fed member has yet to do.

I think he is likely responsible for financial damage on a global scale and likely forced the Fed to cut the discount rate.

All I can say is - wow.

[c1ue]

Re: Did Bill Poole royaly F*** up?

Maybe, and maybe the Fed is trying to both pump money and keep the dollar from collapsing.

Certainly Bill Poole exaggerated the panic with his statement, but on the other hand 1) He is only one governor out of many and 2) A full dollar collapse would officially put the fox in the monetary hen house.

I won't consider him a finger puppet of the man until the Fed does a surprise fund cut and/or starts talking rate cut even with inflation at official near-bad levels.

[Tet]

Re: Did Bill Poole royaly F*** up?

Maybe, and maybe the Fed is trying to both pump money and keep the dollar from collapsing.

Certainly Bill Poole exaggerated the panic with his statement, but on the other hand 1) He is only one governor out of many and 2) A full dollar collapse would officially put the fox in the monetary hen house.

I won't consider him a finger puppet of the man until the Fed does a surprise fund cut and/or starts talking rate cut even with inflation at official near-bad levels.

The Fed's job is to get the largest amount of cows betting the wrong direction, I'm pretty sure Bill accomplished that. Nothing quite like a short covering rally. Uncle Buck is the world's problem, certainly not the Fed's problem.

[blazespinnaker]

Re: Did Bill Poole royaly F*** up?

The Fed's job is to get the largest amount of cows betting the wrong direction, I'm pretty sure Bill accomplished that. Nothing quite like a short covering rally. Uncle Buck is the world's problem, certainly not the Fed's problem.

Call me naive, but I really don't believe in Fed conspiracies.

I think he just f**cked up. Talking smack when the markets are roiled has got to be numero uno stupidity. The Job of the fed is *not* to freak everyone out like that.

He basically said "we're not going to cut unless there is a calamity". He used the word "calamity" fer chrissakes! What the hell is the fed doing using the word "calamity"?

He should be removed from the fed.

No wonder Richard subbed in for him on the extraordinary rate cut ... they probably didn't let him sit at the table.

[idianov]

Re: Did Bill Poole royaly F*** up?

Do not underestimate Federal Open Mouth Committee. The dollar did not crash and money went into bonds instead of heaven. Poole did a great job.

[Finster]

Re: Did Bill Poole royaly F*** up?

Do not underestimate Federal Open Mouth Committee. The dollar did not crash and money went into bonds instead of heaven. Poole did a great job.

Bull's eye. Poole did exactly what he should have. Given the precarious state of the dollar and the level of inflation in the system, the Fed cannot allow itself to be seen as an agent of moral hazard rushing to the rescue of hedge funds.

[Tet]

Re: Did Bill Poole royaly F*** up?

Call me naive, but I really don't believe in Fed conspiracies.

I think he just f**cked up. Talking smack when the markets are roiled has got to be numero uno stupidity. The Job of the fed is *not* to freak everyone out like that.

He basically said "we're not going to cut unless there is a calamity". He used the word "calamity" fer chrissakes! What the hell is the fed doing using the word "calamity"?

He should be removed from the fed.

No wonder Richard subbed in for him on the extraordinary rate cut ... they probably didn't let him sit at the table.

Poole has served at the Fed since 1998, when you own the media you don't screw-up by having the media report something that was unintented and not well thought out. His bio.

Poole was the Herbert H. Goldberger Professor of Economics at Brown University, Providence, R.I. He joined the faculty at Brown in 1974 and twice served as chairman of the economics department. He served on the economics faculty at The Johns Hopkins University from 1963 to 1969. He was inducted into The Johns Hopkins Society of Scholars in May 2005.
Mr. Poole was a member of the Council of Economic Advisers from 1982 to 1985 during the first Reagan Administration and was a member of the Academic Advisory Panels of the Federal Reserve banks of New York and Boston.

Now from you

He basically said "we're not going to cut unless there is a calamity". He used the word "calamity" fer chrissakes! What the hell is the fed doing using the word "calamity"?

Getting the shorts to hold their bets overnight requires words like calamity coming from a Fed official and not just a Fed official but a President of the Fed. The Fed has pulled well over a trillion Uncle Bucks from this latest slide in the market's value, I'd bet they've stolen all they need to steal, the Federal Govt Fiscal Year ends in September. There is no conspiracy about the Federal Governments Fiscal Year end is there? You are aware that the Federal Reserve pays the Federal Government to be able to operate this scam aren't you? This is the time period for when the payment is due, just in case you were wondering why crashes and large corrections happen in September and October. The Federal Reserve is certainly not a nonprofit organization, they serve to make a profit. In a Zero Sum game you can only make a $billion by stealing a $1,000 from a million cows. I get the feeling that the Fed Banks and insiders went long the market on Thursday night and the word calamity made them a lot more than just a billion. That was a well chosen word, very chosen. I would think the Fed is done stealing from the 401K piggy bank and in order to keep the scam going for another year they're going to have to make the market head higher or nobodies going to play any longer.

[Rajiv]

Re: Did Bill Poole royaly F*** up?

In a Zero Sum game you can only make a $billion by stealing a $1,000 from a million cows.

If two people are sitting at a poker table -- one has a mountain of chips, and the other has a paltry few chips. Who do you think is going to win the game?

[Tet]

Re: Did Bill Poole royaly F*** up?

If two people are sitting at a poker table -- one has a mountain of chips, and the other has a paltry few chips. Who do you think is going to win the game?

Never bet against the House/Fed, the problem is understanding when the House/Fed is bluffing/shorting and when the House/Fed is holding Pat/long. Now the trick to your example is the House/Fed keeping that one player/sucker in the game until a couple players/suckers show up, that is right now the House/Fed's biggest concern is the poker table folds because the last sucker leaves. The market is still using the Houses/Fed's money, not the players/suckers. Nothing quite like a short covering rally to get the players/suckers into the game. Now we're trying to scare the suckers money out of Money Markets, that's the funniest thing I've ever heard, where does one suppose these Money Market funds are going to flow? Maybe the Poker Table? Lot's of cash still sitting on the sidelines that the House/Fed can't get to unless it enters the game. The trick here is getting that cash into the game.

[Finster]

Re: Did Bill Poole royaly F*** up?

If two people are sitting at a poker table -- one has a mountain of chips, and the other has a paltry few chips. Who do you think is going to win the game?

The one who can make chips out of nothing.

[metalman]

Re: Did Bill Poole royaly F*** up?

The one who can make chips out of nothing.

exactly. i was gonna say: the one who can print his own chips. but as al greaseman said, he can't guarantee their purchasing power.

[blazespinnaker]

Re: Did Bill Poole royaly F*** up?

Bull's eye. Poole did exactly what he should have. Given the precarious state of the dollar and the level of inflation in the system, the Fed cannot allow itself to be seen as an agent of moral hazard rushing to the rescue of hedge funds.

Nah, they just look weak handed and inconsistent. Left hand doesn't have a clue what the right hand is doing.

The idea that this was planned is, frankly, laughable. If it was planned, then they should all be lead out and shot. I'll agree you don't tell the truth (after all, the truth is never clear), but you most certainly don't lie either. That just undermines your credibility.

And credibility is the only thing the Fed has. Without it, they have no influence whatsoever. The next time poole talks? People will merely snigger.

[c1ue]

Re: Did Bill Poole royaly F*** up?

The whole Poole/Fed discount rate cut show could be a comedy of errors, but I still believe that the Fed has to maintain credibility.

As has been repeated many times in various threads, the Fed has primarily 1 blunt instrument in its arsenal - the funds rate cut.

It is very conceivable that executing a surprise funds cut will simultaneously whack the dollar, raise inflation, and kill all Fed credibility by failing to even cure the liquidity crisis.

At that point the Fed is done and will have to be replaced by some other institution.

None of the committee members are idiots; I am convinced this is the issue square in their collective consciousness.