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Old 12-16-2008, 11:33 PM
 
3,853 posts, read 11,848,613 times
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Quote:
Originally Posted by texan2yankee View Post
Let's see if we are prepared? Everyone has taken a beating in their real estate portfolio, stock portfolio, job situations are tentative, unemployment climbing, credit is tight and not easing AT ALL due to interest rate drops, lack of credibility in rating agencies (Madoff et al), commercial real estate shoe still to drop, etc. Yeah, everything is just peachy because the market has rallied a few points. Woop, woop! I don't know about the rest of the country but NYC is zombie land these days.

Besides, wasn't this tried in Japan in the 90s? It turned out GREAT for them, NOT.
Inflation is going to pick up again. If you are heavy in cash, better diversify out of it because inflation, here we come!
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Old 12-17-2008, 08:35 AM
 
Location: Los Angeles Area
3,306 posts, read 3,553,414 times
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Quote:
Originally Posted by killer2021 View Post
Inflation is going to pick up again. If you are heavy in cash, better diversify out of it because inflation, here we come!
This is sorta like chicken little at this point......
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Old 12-17-2008, 08:43 AM
 
Location: Hope, AR
1,505 posts, read 2,853,581 times
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It is actually possible for them to go negative and create a give back program that pays people to borrow money.

Quote:
Originally Posted by HappyTexan View Post
Lower than expected. There's no where left to run now that it's at 0.
Helicopter Ben needs to find some new rabbits for his hat.

Fed cuts target for key rate to record low - Yahoo! Finance (http://finance.yahoo.com/news/Fed-cuts-target-for-key-rate-apf-13846723.html - broken link)

snippet:
"The central bank on Tuesday said it had reduced the federal funds rate, the interest that banks charge each other, to a range of zero to 0.25 percent. That is down from the 1 percent target rate in effect since the last meeting in October. Many analysts had expected the Fed to make a smaller cut to 0.5 percent."
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Old 12-17-2008, 08:55 AM
 
Location: Hope, AR
1,505 posts, read 2,853,581 times
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If we're in deflation now, than the rate cuts might move us back to equilibrium, not inflation.
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Old 12-17-2008, 09:02 AM
 
Location: Los Angeles Area
3,306 posts, read 3,553,414 times
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The rate cuts will do nothing.
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Old 12-17-2008, 11:51 AM
 
8,890 posts, read 7,872,064 times
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There'll be heavy government spending. For most people, it will be very inflationary like the first half of 2008. The market is already behaving like 2002 when the Fed last "threatened" to buy assets. It looks to me like the Fed is actually buying treasuries since treasuries are no longer selling off when stocks rise.
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Old 12-17-2008, 11:53 AM
 
Location: NE Florida
9,362 posts, read 23,168,279 times
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Time to lock in that adjustable rate HELOC!
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Old 12-17-2008, 12:05 PM
 
18,324 posts, read 16,272,423 times
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Quote:
Originally Posted by lchoro View Post
There'll be heavy government spending. For most people, it will be very inflationary like the first half of 2008. The market is already behaving like 2002 when the Fed last "threatened" to buy assets. It looks to me like the Fed is actually buying treasuries since treasuries are no longer selling off when stocks rise.
Hi lchoro,

The Fed buy treasuries to increase the money supply. Its Fed open market operations 101.

Inflation will occur if the economic collapse sends enough people from productive input into unemployment such that it cuts into the supply of goods and services. Don't look for much of this in 2009.
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Old 12-18-2008, 07:12 AM
 
8,890 posts, read 7,872,064 times
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The Fed is buying all kinds of assets to increase the money supply. Those "loans" to Wall Street are non-recourse and the "haircuts" are merely 2 to 15 percent on assets the market has priced at 50 percent off or worse.

At the current price of oil, much of the production of oil domestically and in deepwater rigs is noneconomical. The shutdown of oil rigs and nonconventional production has already begun.
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Old 12-18-2008, 07:46 AM
 
1,956 posts, read 4,860,858 times
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Quote:
Originally Posted by lchoro View Post

At the current price of oil, much of the production of oil domestically and in deepwater rigs is noneconomical. The shutdown of oil rigs and nonconventional production has already begun.
I hope purchases for the strategic petroleum reserve have picked back up and they're filling it.
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