Interest Rate Cuts Won't Solve Supply.

[Mac1958]

Disappointing to see the Fed do this. Now Powell looks panicky, and interest rates are not the problem.

 

[Chuz Life]

The fed cut interest rates again in another effort to ward off a trump recession.

My education and degree is in accounting and finance. I had to take those economic courses to get my degree but I'm by no means an expert in the subject.

While I'm not an expert I do know the simple laws of supply and demand.

Cutting interest rates will only cause inflation because it's not demand that is causing the economic problems. It's supply. Creating more of a demand of goods that aren't in supply will cause what's left in supply to cost much more.

Big business foolishly sent our jobs to Asia or business too heavily depends on parts being made in Asia.

Now that the supply line has been disrupted by a virus, the supply isn't there. Which will cause inflation for what is left because there still is a demand.

As the virus works it's way through the world, demand will fall. Which will further harm the economy.

All the rate cut will do is make borrowing cheaper for the rich. Further widening the income gap.

DOW quote and summary -- MSN Money

You studied economics?

When rich people borrow money. . . What do you suppose they might use the money for?

 

[Sunsettommy]

The fed cut interest rates again in another effort to ward off a trump recession.

My education and degree is in accounting and finance. I had to take those economic courses to get my degree but I'm by no means an expert in the subject.

While I'm not an expert I do know the simple laws of supply and demand.

Cutting interest rates will only cause inflation because it's not demand that is causing the economic problems. It's supply. Creating more of a demand of goods that aren't in supply will cause what's left in supply to cost much more.

Big business foolishly sent our jobs to Asia or business too heavily depends on parts being made in Asia.

Now that the supply line has been disrupted by a virus, the supply isn't there. Which will cause inflation for what is left because there still is a demand.

As the virus works it's way through the world, demand will fall. Which will further harm the economy.

All the rate cut will do is make borrowing cheaper for the rich. Further widening the income gap.

DOW quote and summary -- MSN Money

You posted a false narrative since nowhere in the link claims Feds cut was to ward off a non existent recession.

The reason for this post and the link with it isn't what you assumed.

The fed cut interest rates today. Which normally would cause an increase in the stock market. The exact opposite happened.

My post was explaining why the stock market is still falling and why the fed cut won't stop it.

The link was to show where the dow ended up today.

You obviously got the wrong thing from my post.

Do you have any education or experience with economics?

If so, you need more.

If not, you need to learn something about this before you post and make a total fool of yourself.

Now you come across like an asshole, it is now clear I was correct that YOUR link didn't talk about a recession at all!

Your first sentence, which is what I responded to:

"The fed cut interest rates again in another effort to ward off a trump recession."

Your article says not a word about recession at all, stop being a liar!

A recession that doesn't yet exist, you a special kind of stupid?

Your degree in economics hasn't showed up today, maybe it was really a degree in bullshit?

Did you read the title of this thread?

It's about supply and why the fed cut didn't stop the bleeding of the stock market.

As I said, I put that up to show today's stock market levels.

If you want to go off on recession go for it.

You'll need to start a new thread for that.

Meanwhile this thread is about the reason why the stock market is still falling.

Do you have anything to contribute to the subject of the thread?

It's clear that supply is slowing and it may get worse. Which means that all the demand in the world isn't going to make any difference. In fact higher demand while low or no supply will cause inflation.

Do you understand capitalism and supply and demand? Do you understand free markets?

If not maybe a Econ 101 book might help.

Now you are just avoiding what YOU said in your first post, that I had replied to, you keep avoiding it because I caught you with your pants sown around your ankles.

Once again for the slow motion thinker you are: "The fed cut interest rates again in another effort to ward off a trump recession."

That is what YOU wrote in the first line of your first post. The LINK you provided doesn't say anything about recession at all, that was from YOU, then after it plunged a lot the next day, to only soar upward the next day after that, which destroys your narrative anyway.

Money Market

How Long Will This Stock Market Volatility Last? Here's Your Action Plan

By Kyle Anderson, Associate Editor, Money Morning • @KyleAndersonMM • March 3, 2020

Selected Excerpt:

Last week was the worst for markets since the 2008 financial crisis. All major indexes fell into correction territory and are now approaching bear market levels.

The Dow Jones Industrial Average dropped nearly 3,600 points (12.4%) last week alone.

Yesterday was a completely different story. The Dow rocketed 1,200 points higher. It was the largest daily point gain in the history of the Dow.

The question on everyone's mind: How long will this stock market volatility last?

Unfortunately, there is simply no telling.

The coronavirus epidemic is something economists refer to as an "exogenous shock." That means it's an impossible-to-predict event that didn't stem from the economy. The terrorist attacks of Sept. 11, 2001, are another example.

LINK

The Stock Market is reacting wildly to every bit news lately, an irrational behavior that needs to stop, too much volatility in so little time frame. Very little mention of recession anywhere except in overrated economic degreed holders small brains, who finds a dirty penny behind every door.

Dow closes nearly 1,200 points higher as Biden Super Tuesday victories boost health care stocks

First it was Corona Virus fears, then Fed rate drop, then Biden wins...…..

Corona Virus scaremongering is a major cause in why people are behaving stupidly.

It is an EMOTIONAL Rollercoaster.

Go take a hike pal!