| It's not about rate cuts
As the Fed meets today and tomorrow in Washington, there's less certainty than ever about what the bank will do next. Financial markets are primed for a half-a-percentage-point rate cut tomorrow. Trading in federal funds futures, for example, puts the odds of a 0.5-point reduction at 80 per cent. But with the U.S. economy teetering on the brink of recession - maybe even in one already -- the Fed seems a bit lost. With all its economists and sophisticated models, the Fed missed the severity of the housing slump and the sharp rise in foreclosures. It also underestimated the spillover effect on credit markets. And now it seems to be reacting to events, rather than anticipating them. Mr. Bernanke is in a corner. He announced the largest rate cut since the 1980s after global stock markets crashed Jan.
Voice of the reader 9-14
Ask anyone who knows me. But I am not a wet noodle. You see negative aspects and say we cannot change or fix it. Or maybe that we should not try to change it, since it has always been and always will be. But that is like saying I have an infection, doctor. But do nothing to treat it because there is no hope. I have no choice but to try, even if I get tired or feel like I am getting nowhere. What helps me is that I know I am not alone in the ways I feel. Yet I know that if I do not speak up, especially here in SI, where I seem to be a lone voice on some issues, no one may. Because although others in this area feel as I do, they do not all take time to write letters, or do not want to offend, or because it is easier to do nothing. I have not been this way for that long. As long as two years ago, I was trusting that our government was looking out for us, and that the problems we had would work themselves out.
Credit crunch: What it means for you
The phrases 'credit crunch' and 'subprime crisis' get bandied around a lot in the business pages but how does this seemingly distant phenomenon affect the average British consumer? Below, we round up expert comment and analysis from recent days, and reports of how consumers have been affected. Finally we present our advice on how to minimise that impact in each area of your finances. DON'T MISS: >> MARKET TURMOIL: STOCK MARKET SLUMP 2008 >> 2008: FORECASTS AND PREDICTIONS >> Interest rates: News, advice, predictions EXPERT COMMENT AND ANALYSIS: .
|
