5/3/08

Financial crises are good news for the market

The reason is that our leaders, who were asleep at the wheel when the current crisis was brewing, are forced to remedy the situation.

How? The only way they know. They print money. And money is good news for Wall Street (as I have been saying for some time in this space.)

Here we go again.

The Federal Reserve, seeking to prevent a deeper economic slowdown, took another stab at coaxing banks into lending at lower rates.

The Fed boosted its biweekly Term Auction Facility sales of cash to banks by 50 percent to $75 billion and expanded the collateral it takes from bond dealers through loans of Treasury securities. It also raised the amount of dollars it makes available to the European Central Bank and Swiss National Bank through swap lines to a combined $62 billion from $36 billion.

This is the reason the market is going up, while the crowd worries.

More, much more on https://www.peterdag.com/.

George Dagnino, PhD
Editor, The Peter Dag Portfolio
Since 1977

No comments: