50 point rate cut and the Dow down?

[Gordo]

Wall Street watched a Fed rally abruptly fizzle on Wednesday, as excitement over an interest rate cut gave way to concern about a new round of problems related to the subprime mortgage crisis.
Markets began a late-day slide after a leading agency slashed its credit rating on Financial Guaranty, one of the nation’s largest bond insurers. Many investors are concerned that bond insurers will be forced to renege on their guarantees of bonds linked to risky home loans, exacerbating the credit problems facing the financial industry.
The Dow Jones industrials tumbled to a 37-point loss, closing at 12,442.83, down 0.3 percent. The broader Standard & Poor’s 500-stock index lost 0.5 percent to finish at 1,355.81.

Stocks Rally on Rate Cut New York Times - 2 hours ago

[Uncle Jack]

Re: 50 point rate cut and the Dow down?

Get used to this. It's an exact replay of 2001, almost. The Fed follows the market lower. Each rate cut has less and less of an impact, and each new rate cut from here will be met with increased selling pressure.

In the year 2017 (or there abouts) stocks will be a screaming buy at a P/E multiple of less than 10. Oh sure, we'll have our moments of glee before then, but that's about the time you'll be assured of buying at bargain prices with a dividend yield near 6%.

[jk]

Re: 50 point rate cut and the Dow down?

Get used to this. It's an exact replay of 2001, almost. The Fed follows the market lower. Each rate cut has less and less of an impact, and each new rate cut from here will be met with increased selling pressure.

In the year 2017 (or there abouts) stocks will be a screaming buy at a P/E multiple of less than 10. Oh sure, we'll have our moments of glee before then, but that's about the time you'll be assured of buying at bargain prices with a dividend yield near 6%.

it's nice to have something to look forward to. :rolleyes:

[rabot10]

Re: 50 point rate cut and the Dow down?

it's nice to have something to look forward to. :rolleyes:

Going lower IMHO