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The Times' Rorshach Geithner Story
Apr 27 20099:04am EDT -
Sinking Animal Spirits
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Counter-cyclical Urban Policy
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Be Your Own Counterfeiter
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Being Tim Geithner
Apr 25 200912:04pm EDT -
Notes From a Press Conference Naif
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What Good is the News?
Apr 25 20098:04am EDT -
Stressful Enough
Apr 24 20092:04pm EDT -
Not Regretting the Pound
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Introducing the New Ford Squeeze
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Non-Economic Questions of the Day
Apr 24 20099:04am EDT -
The Stress Test Blind Alley
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Happy Hour
Apr 23 20099:04pm EDT -
Recovery Without Rebalancing
Apr 23 20096:04pm EDT -
The Shape of Your Recession
Apr 23 20095:04pm EDT
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The New Committee to Save the World: Success!
Today's 75bp rate cut came as no surprise to anybody: if anything, markets were expecting something even bigger. And when markets started trading on Monday morning, the Fed's interventions and policy changes on Sunday were well known. Which means that as far as Fed activity is concerned, the markets have received no good news and possibly even bad news (if they were expecting a 100bp rate cut) since they opened on Monday.
And yet the S&P 500, which opened Monday at 1,266, closed today at 1,330. That's a rise of 64 points, or just over 5%, over the course of two trading sessions. It's actually higher now than it was immediately before traders were mildly disappointed by the 75bp rate cut; it's higher even than it was when Bear Stearns started running into liquidity problems on Thursday. Or, to put it another way, the stock market without Bear Stearns, today, is worth more than the stock market with Bear Stearns, on Friday. And the credit markets look better, too. Which might say something unflattering about Bear Stearns. But it also surely says something reasonably good about the team of Ben Bernanke, Hank Paulson, and Jamie Dimon.
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