How much would you normally expect an interest rate cut to bump the market?

How much wood could a woodchuck chuck if a woodchuck could chuck wood?

It depends on how much Mr. Market was expecting. If Mr. Market expected a 25bp cut, and he got it, there'd be no change. If he wasn't expecting anything, and he got a 75bp cut ...

It was funny watching them cream themselves when it dropped, and they almost didn't want to report the immediate recovery. How long until they just start making their own bad news?

The real effects of an interest rate cut on the economy usually take 6 months before they are felt.

So the Fed move was psycological. But the mkt went from euforia for a 75bbp unexpected cut, to worry that the Fed knew more doom was ahead, to skepticism of the fed actions given the Societe' Generale story.

The mkt is now left with some big questions... Will the fed ease again next week at their scheduled meeting (mkt is pricing 38bp as I type)? What happens if they don't? Is the economy really going towards a recession or was it olny the media?

Next wee we have the release of new home sales, durable goods order, consumer conference, the Fed decision, GDP, Personal Income/Spending and job report...

OH NO!!!!!! The market has been opened for only 10 minutes and it's already up another 100 points. How can this be??? The deficit, Iraq, oil prices, Bush, unemployment, housing, Bush, the election, sub-prime fiasco, Bush, a bad case of indigestion, Bush.

Somethings wrong. The world is ending, but the market is skyrocketing. What can we do??? No worries though...there won't be a word mentioned on CNN. Whew!

Think short-covering drove most of rally, esp Tue, Wed. Thu some real buying but the covered names rolled over. Fri (today) pretty quiet, market momentum slowed from Thu. Plenty of names down, I see more red than green.

We are in red right now.... no no... turning green... oh no.. rumor of a big hedge fund in trouble... and a medley report calling for 50bp next week...

... It's not possible to trade a mkt like this. The best way to play it is to stay out. Let the dust settle. Yes you can make a quick 5-6%. But u can lose 25% also.

And the market can stay irrational far longer than you can stay solvent.

Yes...but you only win or lose if you pull money out. Otherwise it's just headlines. Stay the course.


(Did I say that?)

Very true.

And that last sentence has words of wisdom that I'm likely to print out in 72-point type and frame above my desk at home tonight. Well-said.

(of course I've learned this the hard way once or twice. . .)

Let me write that down "you can only win or lose if you pull money out" so that I don't get confused and make a mistake.;)

Glad you understand.

Using a rally or a loss to describe the economy is like saying there is or isn't global warming because it snowed or got hot today.

Everything seems brilliantly in place for a general downturn of the economy, if average investors panic, or the top 500 or so investors decide to cash out on a regular basis and rebuy on the downswing.

Please note I was away from the computer during market open. I will not disappoint. I took the market down with my gloom and doom talk later in the day.

Aren't they opening for The Foo Fighters this tour?

Is that a rhetorical question? :D