Sun Aug 11, 2019, 10:58 PM

Sending an SOS to the Federal Reserve; Why the Fed Must Approve an Emergency Rate Cut

By Stephen Moore and Louis Woodhill - - Friday, August 9, 2019

To keep the economy from a further growth slowdown, the Fed must inject more dollar liquidity into the global economy. Immediately.

The next Fed rate cut cannot wait until September. Fed Chairman Jerome Powell should call an emergency meeting of the Federal Open Market Committee (FOMC) and cut rates in the next few days. Waiting another month will only prolong economic uncertainty. We need the Fed for once to be proactive.

All of the financial data of the last week — the strengthening of the dollar, the super-low 1.75 percent interest rate on 10-year Treasuries, the inversion of the yield curve, the drop in the 5-year TIPS spread to 1.3 percent, and the big fall in commodity prices (except gold) — are screaming out the same SOS message to the Fed: There is a dangerous and worsening global dollar shortage.

Our friends at The Wall Street Journal are calling the recent market sell-off the “Navarro Recession” — a deserved poke at the pro-tariff policies of White House Economic Adviser Peter Navarro. Donald Trump has embraced that strategy.

Yes, the escalation of the trade and tariff war is hurting growth and triggered this latest crisis. Alas, there is nothing the Fed can do about the trade stalemate. But what the Fed can reverse is the dollar liquidity crisis.


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Reply Sending an SOS to the Federal Reserve; Why the Fed Must Approve an Emergency Rate Cut (Original post)
RCW2014 Aug 2019 OP
rampartb Aug 2019 #1

Response to RCW2014 (Original post)

Mon Aug 12, 2019, 03:30 AM

1. lolololololol not only no but hell no

interest rates were just cut, and they are real low to begin with.

you capitalists better start reaching for your bootstraps and stop depending on the fed to save your shaky empires.

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