Dear Chairman Bernanke – We Need More Crack
This was so predictable. As I mentioned in my post from a few weeks ago titled Can I Have Some More Crack Please? I am not a macroeconomics guy. I don’t watch the market nor do I watch TV news. However, I do get WSJ.COM alerts (mostly for my own amusement to see what they think is worth emailing out alerts about.)
Here was today’s:
Feb. 5, 2008
The Dow Jones Industrial Average plunged by 370 points, or 2.9%, as investors’ anxiety about a possible recession flared following a bleak reading on the U.S. services sector and cautionary language about the economic outlook from a Federal Reserve official. It was the worst performance of the year so far for the blue-chip average in both point and percentage terms. Other major benchmarks also sold off dramatically. The S&P 500 Index plummeted by 3.2% and the Nasdaq Composite Index dropped 3.1%.
I guess the crack high has worn off and it’s time for another hit. Rate cute anyone?
Brad, there's a GREAT recap from Krugman on how we got here, take the time to watch the whole thing:
http://ocrampal.com/node/49
Jim Cramer agrees with you: lower rates, and by the way can the rebates:
http://nymag.com/news/businessfinance/bottomline/...
Hey Brad.
Low rates are part of the problem, not part of the solution. The risk prizes are soooo low that the risky investments aren't worth… no pain, no gain! To try to smooth it is to hide the head in the sand
I know. I'm very negative on the rate cuts for exactly this reason. It's basically economic crack at this point. It creates a short term high that fades very quickly and requires another hit.
Based on his use of the word "crack", I assumed that Brad was negative on the whole rate cut thing…