Fed cuts overnight rate 75 basis points
Global markets panicked on their Monday and Tuesday trading days driving futures on US stocks to record reductions. At 5 am, when I turned on CNBC this morning, the Dow Jones futures were at -500, NASDAQ futures were over 100 points down. But the federal Reserve Board came to the rescue after Asian markets closed and cut the overnight rate .75% to 3.5% according to the Financial Times in time to save the British FTSE;
Down as much as 240 points after the market opened, the FTSE 100 rallied 1.65 per cent to 5,670.2 in early afternoon trading. There had been widespread speculation of a Fed cut earlier in the day, possibly in co-ordinated moves with other central banks.
Don Surber poked a little fun at the foreign markets yesterday;
The panic over the “recession†is entertaining and good for the U.S. economy.
In the United States, we had a Martin Luther King holiday, while the rest of the world had a holiday from common sense.
The various stock markets collapsed as investors turned into bears and enjoyed their biggest panic since 9/11.
What me? I’m holdin’ what I got and depending on the next few days performance, I’m buying. I don’t subscribe to panic. The folks on CNBC were absolutely giddy watching the Asian markets collapse and they had dire predictions for US investors. I hope they all keep selling off – in order to sell your stocks, someone has to be buying them.
This is what separates the men from the boys. Look for the Democrats to try to pin this on the “Bush economy”.
