There are enormously long lags from a change in exchange rates to impact on production and employment. ...The dollar has already weakened and frankly this kind of move isn't going to matter very much.
There was an auto industry correction and a high tech inventory correction, and if we can get through that without tipping the economy into a recession then we can get through this.
They wanted a big splash today. And they got it.
They will be cutting (rates) until they get some signs of rebound.
What the market's figuring out is the Fed is coming toward an end of this movement.
The great problem with doing that in real time is people live in real time and almost everybody's default forecasting method is to extrapolate the recent past.
Everything was out of balance and part of figuring out where we are now is figuring out where we were and how many imbalances were built into the economy.
They simply don't want a recession. It's an insurance policy.
The economy is not in a recession. This economy had enormous spending imbalances that it had to work out.
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