g******1
发帖数: 1 | 1 Did The Fed Just Purposely Try To Crash The Stock Market?
Unless the Federal Reserve is purposely attempting to spread panic on Wall
Street, the decisions that the Fed just made don’t make any sense at all.
Back on March 3rd, the Federal Reserve announced an unscheduled emergency
interest rate cut for the very first time since 2008. Wall Street
immediately interpreted that as a “panic move” and the Dow Jones
Industrial Average ended the session down 785 points. So Fed officials had
to know what was going to happen once they announced an even bigger
unscheduled emergency interest rate cut on Sunday. Predictably, stock
futures hit “limit down” very rapidly, and now investors are bracing for a
week of tremendous carnage. | g******1
发帖数: 1 | 2 But this didn’t have to happen. Yes, we witnessed three of the worst
trading days in U.S. stock market history last week, but on Friday the Dow
Jones Industrial Average was up 1,985 points. It was an absolutely epic
rally, and if the Fed had not caused so much panic there may have been a
good chance that the rally could have continued into next week. | g******1
发帖数: 1 | 3 In other words, U.S. stocks just had one of their best days ever, and there
didn’t appear to be a need for any “emergency intervention” by the Fed.
If the Federal Reserve had just waited a couple of days until their normally
monthly meeting, and if the Fed had just cut rates a quarter point, that
would have likely been greeted by the markets with warm enthusiasm. | g******1
发帖数: 1 | 4 But instead, Fed officials decided to load up their bazooka and go for broke
on Sunday. In addition to using up all of their “interest rate ammunition
” in one epic volley, the Fed also officially restarted quantitative easing… | g******1
发帖数: 1 | 5 The Federal Reserve, saying “the coronavirus outbreak has harmed
communities and disrupted economic activity in many countries, including the
United States,” cut interest rates to essentially zero on Sunday and
launched a massive $700 billion quantitative easing program to shelter the
economy from the effects of the virus.
The new fed funds rate, used as a benchmark both for short-term lending for
financial institutions and as a peg to many consume rates, will now be
targeted at 0%-0.25% down from a target range of 1% to 1.25%. | g******1
发帖数: 1 | 6 These moves have “panic” written all over them, and investors immediately
responded accordingly…
Stock market futures hit “limit down” levels of 5% lower, a move made by
the CME futures exchange to reduce panic in markets. No prices can trade
below that threshold, only at higher prices than that down 5% limit.
Dow Jones Industrial average futures were off by more than 1,000 points,
triggering the limit down level. S |
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