Global Rate Cut, But Stocks Fade

Coordinated emergency rate cut this morning: Fed, UK, ECB. Fed cuts 50 basis points, less than many were demanding. Prior to this announcement, world markets smashed, Japan down 9%. Commodities hit, too. Credit markets still extraordinarily tight. Europe and US futures initially rallied strongly on rate cut, but have since collapsed.

On a positive note–and we realise it comes as little consolation–stocks are finally close to fair value.

(On a negative note, this is fair value because stocks spend half the time BELOW this level).

Meanwhile…

  • Rate cuts helpful but not enough, says Roubini
  • UK announces huge bank bailout (structured intelligently, unlike ours)
  • World stocks and commodities smashed.  Futures down, too.
  • Ban on short-selling ends tonight. Thank goodness they implemented it. Sure helped a lot.
  • Bankrupt states storm Washington for bailouts of their own. California, Massachusetts…
  • Bank of America has to slash offering price to $22.

See Also:
Silver Lining: Stocks Finally Close To Fair Value

OK, Bulls: analyse This
Why Stock Market Still Screwed: Analysts Still See V-Shaped Recovery

And The Bailout…
RTC History Suggests Stock Market Not At a Bottom

 

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