The Fed cut interest rates eight days after the last shift, but why do I feel that the biggest economy in the world is being run on a rolling day-to-day basis with policy makers reacting to each and every little toss and swirl of the markets?
Last week we had a 0.75pc cut which was odd enough (striking one almost as if game of scissors, paper, rock presided over whether to go for 1pc, 0.75pc or 0.5pc and paper won).
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Then, however, to follow it up only a few short days later with another 0.5pc smacks of desperation. The theory going round is that the Fed does not want to be seen as having being spooked by the Société Générale debacle, about which they were as in the dark as the French Government and has, therefore, followed up last week's panic move with a further cut. A bit fanciful, perhaps, but the whole thing does look a bit strange.
Last week we had a 0.75pc cut which was odd enough (striking one almost as if game of scissors, paper, rock presided over whether to go for 1pc, 0.75pc or 0.5pc and paper won).
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Then, however, to follow it up only a few short days later with another 0.5pc smacks of desperation. The theory going round is that the Fed does not want to be seen as having being spooked by the Société Générale debacle, about which they were as in the dark as the French Government and has, therefore, followed up last week's panic move with a further cut. A bit fanciful, perhaps, but the whole thing does look a bit strange.
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