what does a fed rate cut have to do with the market? volatility = what'll ben do next.
Well, it seems like the "rally" is already pricing in a rate cut. It will be interesting if the Fed doesn't cut rates. The only thing I think that could play out to sustain a rally is if the banks continue to report hairy news, consumer confidence takes a beating, unemployment goes bad to worse, and personal spending goes down. Such that the Fed will have to cut rates. At this point, it seems the bad news(to a point) is good news for a rally. The expectation is that things are bad, hence a fed rate cut is factored in.
Of course, there is the liquidity crunch, which hopefully isn't going to be a problem at the institution level. I think that's where the Fed is concerned about. They don't care about the average over-leveraged folk(s) if you ask me. Don't think the fed is trying to save those folks.
Will there be a point where banks/businesses realize burying families and their future generations in debt only hurts their own business in the long run?
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