How F’d Are We dot Com

I got an idea! Let’s lower interest rates in hopes of increasing home sales, refinances and helping people with home loans lower the interest rates on their HELOC. Then, let’s tell everyone that we’re going to do it again in a few weeks. If we do this the people will always wait to buy or refinance because we told them that we’re going to give them a better deal next week. This is a great idea because we’ll all just sit around twiddling our thumbs and not actually do shit. Problem solved, right?

Seriously does my idea make any sense? I didn’t think so which is why I constantly wonder why the Fed lowers rates and then tells the public that they’ll most likely do it again soon. I’m not making this up, I swear. The Fed lowers the rates; then the Fed and the media tells the world that the interest rates are going to go down in the short future and wonders why nobody buys a new home, or refinances their current home loan today. It’s ludicrous and weird. It’s similar to telling a person that they can buy a car today for $500 and for no reason, they can buy the same car next week for $350. I’d wait for the $350 price. Does this method give investors anything to feel comfortable about? Sure it does – they’re comfortable with not investing in markets affected by these absurd acts. They are comfortable not investing in America.

I just got a new idea! Why not lower the rates and tell people nothing? Why not just say “We’re lowering rates this week and might meet again on it in the future”? HMMMM – I might just go out and buy instead of waiting to see what you may do sometime in the future.

I think the definition of insanity is doing the same thing over and over again and expecting different results. I think the Fed is insane but that’s just me. Keep cutting rates Ben and keep telling people it will happen again, and then, and only then, it will never work. The effect of several Fed rate cuts will leave us all waiting for the next cut. If it does ever get out that there will be no more cuts, will it be too late? Cheers to prolonging our dilemma.

This is what we have to work with – this is why I ask How f’d are we?

JG

This entry was posted on Wednesday, February 6th, 2008 at 2:03 am and is filed under Financial. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.