I spend a couple hours every Sunday evening watching the Bloomberg and CNBC Asian desk reporting. I found it fascinating that they were speaking very bluntly about their view of the fed reserve - one that the MSM, in my opinion, is not giving adequate coverage.
The Asian markets - and currency markets - have now explicitly stated that the Fed is Wall Street's bitch. They discussed their expectation for this week's trading in exactly those terms.
More below:
The topic was the fact that Wall Street and the bond markets are pricing US Treasury futures with a 50% certainty that the Fed will reduce rates by another 50 basis points this week. The discussion was that Asia believes the Fed was blindsided (more polite than "duped") by the SocGen fraud.
The commentator then noted:
The market recognizes that the Fed now reacts to Wall Street. It does not look to the underlying data to make its decisions.
It don't get much plainer than that. Then a guest commentator - one that runs a trading book in Asia - said:
We look for the US stock market to trade sharply downward for the next two days to force the Fed to cut interest rates. We believew that the Fed will cut rates if traders can force market declines early in the week.
Jesus, how can the controller of US monetary policy sit there and listen to commentators basically state that the Fed is so clueless as to not have any response to essentially planned attacks on the US dollar through market activity.
Let there be no mistake, if the US cuts rates and the rest of the world holds interest rates flat, any currency trader who shorts the US dollar is going to be able to play golf for the rest of the year based on their 1st quarter earnings.
I give up - we might as well sell shares in the US mint to private interests if this is what Bernanke is going to do.