The one thing the Fed is good at is putting out fires. They did it again this time. Stopping bank runs in their tracks, preventing what could have become an out-of-control conflagration. For now.
But it’s little more than a circle jerk. Yesterday’s firefighting will only lead to more fires down the road tomorrow. For now, it seems as though the joint action of the Fed, Treasury and FDIC has achieved the desired goal of stabilizing the banking system and the financial markets. The stock market has benefitted. And investors who had panicked into bonds are starting to see a bit of erosion of the capital they thought that they were committing to safety.
In short, here’s what happened and more importantly, what lies ahead because of it.Non-subscribers, click here for access.
Subscribers, click here to download the report.
KNOW WHAT’S HAPPENING NOW, before the Street does, read Lee Adler’s Liquidity Trader risk free for 90 days! Act on real-time reality!