Tuesday, November 24, 2009

Ya Think?

From the FOMC minutes:

"Members noted the possibility that some negative side effects might result from the maintenance of very low short-term interest rates for an extended period, including the possibility that such a policy stance could lead to excessive risk-taking in financial markets or an unanchoring of inflation expectations. While members currently saw the likelihood of such effects as relatively low, they would remain alert to these risks."

Hmmm.. deja vu.  The risk is "relatively low?"  Really?  Look at the markets boys!  ALL asset classes!



Jeff said...

First - I love your web site; posts with meat on the bone are very refreshing...
I happened to have on the "Fast Money" gang tonight. They were talking about JCG 'crushing' earnings but were all in agreement that the valution was too high to be a buyer up here. They all just shrugged their shoulders and said "Ya, I can't buy here. The market is not moving on fundamentals anymore."
I just found that interesting. I mean, If I could borrow a zillion dollars at 0% for an extended period, I'd be a buyer too. I really liked your article on risk free investing. Neat stuff. A book you might like is Infectious Greed by Frank Partnoy. He did F.I.A.S.C.O. as well.
Take care,

EconomicDisconnect said...

Well I for one am glad they will be on the alert. These guys are always on top of things so no worries.

Have a great thanksgiving break, and get ready for a Patriots shocker of the Saints Monday night.
(I am a monster Saints fan so this is not a pro-Pats pump)

Joel said...

I live in Columbus, OH and this was in our local paper today; thought you might enjoy it...

I love this part...

"About 20 (percent) to 30 percent of the mortgages are fraudulent," Dimon said. "People lied about their income or about living (in the houses they purchased)."

And many unqualified people have tried to take advantage of the government's "Cash-for-Clunkers" program, as well as the $8,000 tax deduction for first-time homebuyers, he said.

"The government is learning what we know -- that a lot of people want something they don't deserve."

right... and all his mortgage brokers are saints...