Why the Fed bailout might not work

[Soultrader 12]

Interesting article on CNN: http://money.cnn.com/2007/12/12/news/economy/eavis_fortune.fortune/index.htm?postversion=2007121304

[Soultrader 12]

Asian markets declined nicely today followed mainly by the banking sector on further worries on writedowns.

 

Will need to see the US opening reaction to this.

[notouch 10]

The close will be more telling than the open.

[notouch 10]

Interesting article. I think there has been a lot of political intervention to get the central banks to intervene. Only a few months ago the Bank of England was saying it's not their job to bail out banks that had made bad bets but now that's exactly what they're doing. It's just creating more problems for the future.

[Thembani Nkomo 10]

Very interesting article on the Fed's bailout.

[PYenner 10]

The BOE has also lowered interest rates and offered loans to housing lenders, so GBP and USD are both attempting to limit further slides.

What is needed though is something to inspire longer term confidence and that is still lacking so we are still left with taking each day as it comes.

 

Prior to the recent falls in GBP and USD, Pounds were "invested" in EURUSD and USD were "invested" in CAD. Those "investments" have recently been reversed or "cashed in", sorry I don't know a better way of describing it.

It suggests that the major slides in GBP and USD are finished, but again it tells you nothing constructive about the future. I wonder if news gets deliberately leaked after the movements have already been factored into the markets. Three days ago it would have been nice to know that CAD was going to slide for three days but how much use is that information now?

 

Recently JPY and EUR have been strong but only in relative terms, they lacked the weakness of GBP and USD, neither has actual strength imo.

Unfortunately I have not had time to follow things properly but my impression is that there is no single currency that inspires confidence so I am inclined to keep my money in my pocket over Xmas/NewYear unless the market gives me a better reason than it has recently to think that the reward might be in proportion to the risk. Mostly all I see is risk on offer, without reward.