Tuesday, October 30, 2007
Trick or Treat
The Fed is meeting today to discuss among other things the lowering of the Federal interest rate tomorrow. It is widely believed that the Fed will lower interest rates again, but it is unclear how much (most economists are predicting 25 points). The market has been anticipating another cut since the 50 point cut in September. More importantly the Fed needs to come out with some calming words that can give the market some confidence heading into the holiday season. I am not sure Ben Bernanke fully understands the power of his words. Look for the markets to be calm, slightly to the down side until the announcement.