Originally Posted by jefftheshark
The Fed raised the discount rate to 0.75 tonight after market close and the futures are down right now.
This combined with options expirations tomorrow could make for a very volatile trading session.
Of course, everyone's fear is that they're tightening too soon and repeating the mistakes the Fed made in the mid-30's when they snuffed out the recovery and set us into a double-dip depression. I guess time will tell.
A long time ago in a land far away I used to read through a lot of crap trying to figure out what caused the last depression, as if it was some mystery.
I used to read endlessly about what the FED did right or wrong as if it was actually trying to avoid one.
Events that happen over such a long time frame look different in the context of history than they do up close.
Those that write about them are by definition in them until much later and if you the look back without being too biased you can pretty much see the writing on the wall.
Jefferson warned everyone hundreds of years ago about this, he was a smart guy, people need to figure it out.
This stuff isn't an accident and no one with a brain would think our economy is strong enough right now to begin raising rates when there is no demand for credit.
All the debt metrics tell you all you need to know, into that abyss they'll use a few reports as cover to claim they were just worried about inflation but all the best and brightest guys I know don't worry about that yet.
They know what's up and what's comming.