*0%* - Money is now FREE in the USA

[broken_legs]

Surprised no ones on this yet!


Helicopter Ben surprised everyone and instead of the expected 0.5% cut in the overnight rate he cut it to ZERO %.

Money is now free in the United States.



If anything I think this only signals how dire the situation really is there.

Look what 0% interest rates did for Japan.


Discuss...

[Xtrema]

Sucks to be on fixed income and there will be no jobs to be had.

[broken_legs]

OK WTF


On GlobeINvestor its telling me the interest rate cut was 75 basis points to 0.25%, while on CNBC on the drive home they were saying that its 0%

Hmmmmm


GlobeINvestor
WASHINGTON — The U.S. Federal Reserve Board on Tuesday aggressively cut its target for overnight interest rates to a record low zero to 0.25 per cent, and said it would employ “all available tools” to dispel a year-long recession.

The surprise move to lower its target for the benchmark federal funds rate by 0.75 percentage points to up to a full point from its prior 1 per cent put the Fed in unprecedented policy territory. Financial markets had expected the Fed to lower rates by no more than three-quarters of a point.





Bloomberg
The Fed said today it will target a federal funds rate of between zero and 0.25 percent, a reduction from the 1 percent level that the Fed failed to hit.



I guess the target rate is below the actual rate.

Quantitative easing takes care of the rest I guess?

[Supa Dexta]

http://forums.beyond.ca/st/245413/us-rate-cuts-head-to-zero/

[broken_legs]

Originally posted by Supa Dexta
http://forums.beyond.ca/st/245413/us-rate-cuts-head-to-zero/


Thats a news story about possible cuts. It was widely expected there would be a 50 basis point cut.


My thread is the actual news.
:angel:

[Supa Dexta]

Yeah I was just showing it was mentioned, and it didn't get any attention.

[Canmorite]

It a target zone from 0-0.25%. Not a target rate.

Fed has now run out of options? Is it worth making the market rally is the dollars behind it are useless and inflation is rampant?

[SilverRex]

still I can only imagine what it will be like many years from now. Hpyer inflation, the US is basically setting themselves up for another crisis.

rates will slowly climb to 20% in order to stop it lol

[broken_legs]

Originally posted by Canmorite
It a target zone from 0-0.25%. Not a target rate.

Fed has now run out of options? Is it worth making the market rally is the dollars behind it are useless and inflation is rampant?


Originally posted by SilverRex
still I can only imagine what it will be like many years from now. Hpyer inflation, the US is basically setting themselves up for another crisis.

rates will slowly climb to 20% in order to stop it lol


Nah man, you guys are crazy!

Do you really think the Fed will just keep all that money out there floating around stealing wealth from everyone and causing inflation? NO WAY!

They are going to wait until the exact moment the economy recovers then take all the money out of the system at night (when everyone is sleeping) and the economy will just keep going up! Duh!

[max_boost]

Originally posted by SilverRex
still I can only imagine what it will be like many years from now. Hpyer inflation, the US is basically setting themselves up for another crisis.

rates will slowly climb to 20% in order to stop it lol

Hyper inflation=Buy GOLD right?

HGU and HBU?

:bigpimp: :bigpimp: :bigpimp:

[BigMass]

when Obama comes in Paul Volcker is going to have to put the rates to %20 so people dont start using the dollar as toilet paper.... Or maybe he won't since that's the final analysis anyways. Amero here we come.

Anyways you cut it though, buy gold. Everyone should own some gold. Not %100 but it's the only thing that's actually worth something. Not the paper IOUs the fed prints.

[Xtrema]

If they are going to artificially print money, why don't we just artificiality assign value to a metal that actually valuable like steel.

Gold is useless other than looking pretty. We switch to steel based currency and artificially set it close to gold prices.

All of a sudden everybody who owns cars will have leverage to get loans. Big 3 won't need a bail out because what's sitting on the lot is now worth something.

[Mckenzie]

Rate is between 0-.25%.

I heard a brilliant man on CBC this morning discussing interest rates and this whole mess and he brought up a good point. (BTW the man is the Canadian Warren Buffet- Steven Jarislowsky) http://www.amazon.ca/Investment-Zoo-Taming-Bulls-Bears/dp/2894722591

The point he brought up was:
-that this is called a balance sheet crisis whereby companies and individuals try to reduce debt and shore up their balance sheets and increase their wealth
-however, with interest rates so low, people are unable to make any return on dividends, interest payments, etc., thereby preventing an increase in their wealth
-as people do not see any rise in wealth, they continue to hoard money and not spend it
-with everyone hoarding cash and no one spending, businesses start hurting
-as banks continue their paranoia, they do not lend, therefore people dont spend, etc.

Starts over and over again...

Japan took 10 years to get out of this situation and they are still not doing very well.

He is promoting massive deficit spending to bring the dollar down even further to bring back the 50 yrs of gains in the manufacturing sector that were pissed away under Harper as he let the dollar go above parity and stay high. He is also promoting an increase in rates so that there can be returns earned on investments, etc.

EDIT: And what is with everyone's boner with gold? Why does it have an intrinsic value that is so mystical? I think it is useless. Maybe 2000 years ago it would have been a great investment, but I dont see why gold is something to sell the farm over and rely on as the last type of wealth. At least oil can heat a house.

[Canmorite]

Blame Harper, eh? What kind of power does he have over the BoC?

[hampstor]

Originally posted by Canmorite
Blame Harper, eh? What kind of power does he have over the BoC?

Almost none - BoC is supposed to be seperated from the political office so decisions are not made for political reasons.

Government = Control Fiscal Policy
BoC = Control Monetary Policy

The similar situation exists in the US, the Federal Reserve is not under the control of the President. \

[Canmorite]

I was being a smart-ass. Mckenzie knows what I mean.

I'm sure Harper could have some influence over the BoC though. Even if the policies are seperate you would think he could have some input.

EDIT: Anyway, back on topic.

[black13]

Originally posted by Mckenzie
Rate is between 0-.25%.

I heard a brilliant man on CBC this morning discussing interest rates and this whole mess and he brought up a good point. (BTW the man is the Canadian Warren Buffet- Steven Jarislowsky) http://www.amazon.ca/Investment-Zoo-Taming-Bulls-Bears/dp/2894722591

The point he brought up was:
-that this is called a balance sheet crisis whereby companies and individuals try to reduce debt and shore up their balance sheets and increase their wealth
-however, with interest rates so low, people are unable to make any return on dividends, interest payments, etc., thereby preventing an increase in their wealth
-as people do not see any rise in wealth, they continue to hoard money and not spend it
-with everyone hoarding cash and no one spending, businesses start hurting
-as banks continue their paranoia, they do not lend, therefore people dont spend, etc.

Starts over and over again...

Japan took 10 years to get out of this situation and they are still not doing very well.

He is promoting massive deficit spending to bring the dollar down even further to bring back the 50 yrs of gains in the manufacturing sector that were pissed away under Harper as he let the dollar go above parity and stay high. He is also promoting an increase in rates so that there can be returns earned on investments, etc.

Yea I heard him speak on the radio as well, very smart man. Hopefully Ottawa will listen to his advice.

[hampstor]

Originally posted by Canmorite
I was being a smart-ass. Mckenzie knows what I mean.

I'm sure Harper could have some influence over the BoC though. Even if the policies are seperate you would think he could have some input.

He has almost no input on maters of monetary policy, the BoC for the most part can make decisions independently - the Governer is not appointed by a political office and can not be removed by one. :)

How scary would that be ? The government controlling BOTH Fiscal and Monetary Policy.... money supply and rates would be set for political motives vs. economic ones.

Besides, the thread title is misleading. The money is not free, if you borrow it you still have to pay it back.

[Canmorite]

If government controlled both of course there'd be a large conflict of interest.

I can't wait to see what effect this has on CPI numbers. We are in a period of deflation, but down the road this could get very interesting. With Gold breaking to 850 again, someone is hedging their currency devaluation.

[BigMass]

Originally posted by Xtrema
If they are going to artificially print money, why don't we just artificiality assign value to a metal that actually valuable like steel.

Gold is useless other than looking pretty. We switch to steel based currency and artificially set it close to gold prices.

All of a sudden everybody who owns cars will have leverage to get loans. Big 3 won't need a bail out because what's sitting on the lot is now worth something.


Originally posted by Mckenzie

EDIT: And what is with everyone's boner with gold? Why does it have an intrinsic value that is so mystical? I think it is useless. Maybe 2000 years ago it would have been a great investment, but I dont see why gold is something to sell the farm over and rely on as the last type of wealth. At least oil can heat a house.

That is a very good question and I’ll write up a long reply tomorrow if you want on why Gold is money and has worth (I need to hit the sack now).

However in the meantime ask yourself why you are so quick to dismiss something with intrinsic scarcity that takes blood, sweat and tears to produce as money, but you will easily accept that a piece of paper with 100 written on it is worth more than that same piece of paper with 1 written on it. A while back people in Zimbabwe thought that a piece of paper with 100 on it was worth something. Now that same piece of paper with 1,000,000,000 on it won’t buy can of Coke. Why? Because it’s just damn piece of paper with NOTHING to back it. It’s intrinsically worthless.

I’ll get back to you tomorrow on why Gold actually has real worth even though you can use it to heat your house hehe.

[Mckenzie]

^I'm all ears as I see no value in holding a gold rock when a countries currency has gone to hell (or no one trusts anyone and they all go to hell). I'd rather have a lump of coal, some oil, some corn futures and clean water.

[max_boost]

I'm on the fence when it comes to Gold and the devaluation of the US dollar. Is it possible? Under what circumstances? Hell, Japan and China hold the largest US reserves right? Fuck everyone is on the same boat here, if the Americans go, so go everyone else. That's why I am so hesitant in buying Gold! At least with Oil I understand. You need to drive people! Consumption will go back up and just waiting for India and China to start upgrading their bicycles hahaha

WAiting to read what BigMass has to contribute though. :thumbsup:

[Antonito]

Originally posted by BigMass
when Obama comes in Paul Volcker is going to have to put the rates to %20 so people dont start using the dollar as toilet paper.... Or maybe he won't since that's the final analysis anyways. Amero here we come.

Anyways you cut it though, buy gold. Everyone should own some gold. Not %100 but it's the only thing that's actually worth something. Not the paper IOUs the fed prints.

What would be the point of switching to an Amero? Either money is worthless and no amount of saying "this money means something" will save it, or the government is indeed able to make the money worth something, and they really don't need to bother with tying it to Mexico at this particular time when they are going to be struggling enough...

[Shunsui]

Originally posted by Antonito


What would be the point of switching to an Amero? Either money is worthless and no amount of saying "this money means something" will save it, or the government is indeed able to make the money worth something, and they really don't need to bother with tying it to Mexico at this particular time when they are going to be struggling enough...

OMG I would so love the amero, Cause then I could buy airforces and jordans and know that some punk in the US didn't get it for cheap lol

[borN]

Warren Buffet - "(Gold) gets dug out of the ground in Africa, or someplace. Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head."

So yeah, a lot of people think it's worthless and a lot of people believe in its intrinsic value. However, it should be interesting to see what happens in the future with the U.S.

[Canmorite]

Originally posted by Shunsui


OMG I would so love the amero, Cause then I could buy airforces and jordans and know that some punk in the US didn't get it for cheap lol

lol ya thats a great reason :thumbsup:

:banghead:

Gold is known as a currency in many countries, and a hedge against future inflation. 870/oz now!

[autosm]

[QUOTE]Originally posted by Mckenzie
[B]Rate is between 0-.25%.

I heard a brilliant man on CBC this morning discussing interest rates and this whole mess and he brought up a good point. (BTW the man is the Canadian Warren Buffet- Steven Jarislowsky) http://www.amazon.ca/Investment-Zoo-Taming-Bulls-Bears/dp/2894722591




He is promoting massive deficit spending to bring the dollar down even further to bring back the 50 yrs of gains in the manufacturing sector that were pissed away under Harper as he let the dollar go above parity and stay high. He is also promoting an increase in rates so that there can be returns earned on investments, etc.


Lots of good points but how can he blame harper for what is going on in Canada? Just about every currancy in the world went up against the USD what was he to do? Raising our intrest rates will increase our $ against the USD

[Mckenzie]

^Well I am paraphrasing significantly and there was much more discussion.

The point is that through monetary and fiscal policy a govt. is able to control the value of the currency to a large degree. Look at USD controlled plunge- brought on by massive debt / deficit and low confidence in the country's stability, etc. Interest rates were still much higher than they were today and the dollar still declined. Gloating about a high dollar and confidence in Canada is not the response you would want to a manufacturing / export sector that was decimated.

Again, deficit spending also must be balanced with fiscal responsibility, etc.

Many complex interacting variables here and obviously no clear-cut solution.

Did I enjoy a year of purchasing goods for cheap from the US? Yes.

Would I give up that miniscule personal gain to give back the jobs and money lost to the sectors hit very hard by the rising dollar? In a heart beat.

[googe]

beyond is hard to read sometimes. if you think you know more than the top economists of the world, and in 5 minutes can point out why they made a terrible decision, just do everyone a favor and dont post :rofl:

[The Cosworth]

Originally posted by googe
beyond is hard to read sometimes. if you think you know more than the top economists of the world, and in 5 minutes can point out why they made a terrible decision, just do everyone a favor and dont post :rofl:

haha :werd:

I thought everyone here worked for the IMF or WB

[autosm]

Personally a 70c dollar is not good for me. I am tired of the eastern bums needing the CAD at 60-70c in order to sell shit to the states

Thats just my opinion I could be wrong?:dunno:

[Antonito]

Originally posted by autosm
Personally a 70c dollar is not good for me. I am tired of the eastern bums needing the CAD at 60-70c in order to sell shit to the states

Thats just my opinion I could be wrong?:dunno:

Not wrong, just having different needs.

Where the disconnect happens is that there's a shitload of people in Ontario, and the industries are pretty much set in their ways so that frequent variation in their approach to the market is damn expensive.

In the West, even assuming everyone was in your situation, there's still not nearly enough votes. Suck, but true

Even worse, most businesses are used to a low dollar, and have built up around that over the last decade or 2, and the high dollar was just a bonus. So even less votes.

Of course if there was justice in the world, everyone could be made happy, but in a country of 30 million people, it's bound to happen that someone is going to get screwed. Shitty luck

[modded46]

Originally posted by googe
beyond is hard to read sometimes. if you think you know more than the top economists of the world, and in 5 minutes can point out why they made a terrible decision, just do everyone a favor and dont post :rofl:

It's called having an opinion.. Last time I was in Canada you still had freedom of speech there and it wasn't completely communist yet.. Might have changed since then who knows. :) :banghead:

[hampstor]

Originally posted by googe
beyond is hard to read sometimes. if you think you know more than the top economists of the world, and in 5 minutes can point out why they made a terrible decision, just do everyone a favor and dont post :rofl:

All the IT professionals on beyond post advice in the computer section, all the economists on beyond post in this section ;)

[Supa Dexta]

Originally posted by autosm
Personally a 70c dollar is not good for me. I am tired of the eastern bums needing the CAD at 60-70c in order to sell shit to the states

Thats just my opinion I could be wrong?:dunno:

:facepalm: Yes I'm sure selling oil in USD hasn't been helping the oil companies out here lately.

[googe]

Originally posted by modded46


It's called having an opinion.. Last time I was in Canada you still had freedom of speech there and it wasn't completely communist yet.. Might have changed since then who knows. :) :banghead:

http://en.wikipedia.org/wiki/I%27m_entitled_to_my_opinion

Whether one has a particular entitlement or right is irrelevant to whether their assertion is true or false. To assert the existence of the right is a failure to assert any justification for the opinion. :)

thats why I dont stand over a surgeons shoulder and tell him he's doing it wrong, even though yes, I am legally allowed to in canada.

[autosm]

Originally posted by Supa Dexta


:facepalm: Yes I'm sure selling oil in USD hasn't been helping the oil companies out here lately.



They were better off when the $ was at par and the oil was 100$ a barrel

[Supa Dexta]

What?! Alert the media!

[autosm]

Originally posted by Supa Dexta
What?! Alert the media!


^^LOL, they already know but are keeping it quiet.


My point was gas in Phoenix is 1.45$ US for 3.8l here its 2.75$ for the same amount.

Why does the business plans of companies in Canada count on the CAD being low? Including oil companies.

When the Cad was at par I had a fire place shipped to my door from the US at 1/2 of what it would cost here in Calgary. Including shipping & GST but no duty. No duty because its made in Canada.

Just my opinion I could be wrong




:rofl: :facepalm:

[Canmorite]

Originally posted by autosm

Why does the business plans of companies in Canada count on the CAD being low? Including oil companies.



I wouldn't say they count on it, they just use long-term historical averages to gauge where they CAD will be and base their business plan around that.

[camper3]

Originally posted by googe
thats why I dont stand over a surgeons shoulder and tell him he's doing it wrong, even though yes, I am legally allowed to in canada.

But who would allow you in the hospital right in the surgery room? Without proper credentials, you wouldn't be allowed in.