Post by unlawflcombatnt on Sept 19, 2007 3:33:39 GMT -6
from Bloomberg:
Fed Rate Cuts Will Spur Recession
By Carol Massar and Michael Patterson
9/18/07
"Interest rate cuts by Federal Reserve Chairman Ben S. Bernanke will spur inflation, cause the U.S. dollar to collapse and push the world's largest economy into recession, investors Jim Rogers and Marc Faber said.
``Every time the Fed turns around to save its friends on Wall Street, it makes the situation worse,'' Rogers said in an interview from Shanghai. ``If Bernanke starts running those printing presses even faster than he's doing already, yes we are going to have a serious recession. The dollar's going to collapse, the bond market's going to collapse. There's going to be a lot of problems in the U.S.''
Defaults on subprime home loans have spurred a rise in worldwide borrowing costs and caused losses at investment funds and banks that made bad bets on stocks and debt securities. The Fed today lowered its benchmark interest rate by a half point to 4.75 percent, the first cut in four years. The dollar fell to a record low against the euro, while U.S. stocks surged the most in four years and Treasury two-year notes gained.
Faber and Rogers, who both spoke today before the Fed decision on rates, said the central bank should raise borrowing costs to quell inflation and support the U.S. currency.
``The cause of the problems we have today, they are due to artificially low interest rates, expansionary monetary policies and extremely rapid credit growth that was fueled by a totally irresponsible Fed,'' said Faber, who oversees about $300 million as managing director of Hong Kong-based investment advisory company Marc Faber Ltd. ``It's suicidal to cut interest rates.''..."
Fed Rate Cuts Will Spur Recession
By Carol Massar and Michael Patterson
9/18/07
"Interest rate cuts by Federal Reserve Chairman Ben S. Bernanke will spur inflation, cause the U.S. dollar to collapse and push the world's largest economy into recession, investors Jim Rogers and Marc Faber said.
``Every time the Fed turns around to save its friends on Wall Street, it makes the situation worse,'' Rogers said in an interview from Shanghai. ``If Bernanke starts running those printing presses even faster than he's doing already, yes we are going to have a serious recession. The dollar's going to collapse, the bond market's going to collapse. There's going to be a lot of problems in the U.S.''
Defaults on subprime home loans have spurred a rise in worldwide borrowing costs and caused losses at investment funds and banks that made bad bets on stocks and debt securities. The Fed today lowered its benchmark interest rate by a half point to 4.75 percent, the first cut in four years. The dollar fell to a record low against the euro, while U.S. stocks surged the most in four years and Treasury two-year notes gained.
Faber and Rogers, who both spoke today before the Fed decision on rates, said the central bank should raise borrowing costs to quell inflation and support the U.S. currency.
``The cause of the problems we have today, they are due to artificially low interest rates, expansionary monetary policies and extremely rapid credit growth that was fueled by a totally irresponsible Fed,'' said Faber, who oversees about $300 million as managing director of Hong Kong-based investment advisory company Marc Faber Ltd. ``It's suicidal to cut interest rates.''..."