I warned on Wall Street Journal Blogs before market speculation on Fed rate cut, that any rate cut will repeat 1998 and 1989 , just delay the already serious housing bubble burst, will be followed by deeper recession.
Fed 50 point cut on top of Dow Jones stock index near its peak, oil, commodities prices at its all time high this inflationary pressure situation is much worse than 1998, 1989, with 7 trillion dollar housing
price gain wealth speculating in housing and stock market,
it will be very tough for Fed to cool it off, it will blow the bubble bigger, as coastal area high end housing prices soared 40- 150 % in July. even Greenspan agree that this house bubble is tough for any central banks to manage, China raise 5 time rates, 7 times bank deposit ratio, still fail to contain the soaring housing and stock price bubble.
both Benanke and market are facing turbulent period ahead.
details can be found onwww.osawh.com/centmaf.html
Comment by Warren Huang - September 24, 2007 at 11:16 am
