jgknot (30.85)

fed rate cut/dollar/economy/recession

September 21, 2007 – Comments (0)

fed rate cut 50 basis point is right, as we need to give a lot of blood when you undergo a surgery if something is wrong. as all the economist predicts the chance of recession is 1in 3, we better be extra cautious to avoid one, and this cut is going to be a booster followed by may be one or two 25 basis points cut in the coming meetings.

this may cut the dollar value and dollar will continue to fall, which will be great for the export markets. and low interest rate at home is good for housing, retail and everything to keep this ecomony in moderate shape.

and also most predict that the ecomony will pickup after the recession, if one happens. with this cute it will definetely pickup soon.(when it pickup, dollar starts to go up based on strong/moderate economy and expectation that fed will raise rates)

so when it starts to pickup, raise the rate to keep inflation in check and that can happen after one year from now.