Replies to post #136426 on Zeev's Turnips Patch-No Politics (ZEEV)

[augieboo]

SM, I think Greenie kind of screwed up with his last testimony before Congress, but I think it started when the FOMC cut by only 25 basis points at its last meeting.

This is just a theory, based on the markets' reactions, but I think that it would have been okay if the FOMC had cut 50 basis points -- i.e., what everybody seemingly expected -- or didn't cut at all. That is to say, I think the markets could have rationalized either a 50 basis point cut ("Gee, it's bad, but they're doing something about it."), or no cut at all, (they must be saving up their ammo).

Greenie then farked it up further by trying to be too cute with his testimony.

Then he had Bernanke try to fix things for him with all that stuff at the end of his speech about improving communication between the FOMC and the markets, which I take to mean

"HEY! DIDN'YOU GUYS GET THE POINT? WE'RE GOING TO SIT
ON THE FED FUNDS RATE UNTIL HE!! FREEZES OVER IF NEED BE."

Unfortunately, it appears that the only market observer with the sophistication to understand Bernanke's point is a certain small, fuzzy white doggie. {G}