Front Page WSJ: “Too Much Hope May Be Pinned On Rate Cut”
On the front page of today’s The Wall Street Journal an article titled “Too Much Hope May Be Pinned On Rate Cut” (subscription required) nicely lays out the varying views towards the effectiveness Fed rate cuts tomorrow and in the near future might have on the economy.
Last week’s positive market action was obviously in anticipation of a rate cut.
But how much can the Fed really do to stem the problems in the housing, mortgage securities and debt markets? These are significant problems with some momentum and it’s not a no brainer that the Fed can just step in, lower interest rates and stabilize these markets.