Quote:
Originally Posted by WestRace
OK, here is the moral/ethical question. Should the Fed step in to save the market?
People are staying home because of the Corona Virus. If the Fed steps in, it's like saying don't stay home, go out and risk getting the virus.
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Not moral nor ethical, just financial/business/economy. At this point I don’t see what the fed can do that will matter. Supply is getting constrained, although it isn’t clear how bad. Demand is falling especially for travel (airline, hotel, cruise) but increasing for stay-at-home and health (screening, masks, etc). Fed monetary policy isn’t going to move the needle on either of those in this circumstance.
Sentiment might be an issue. Does the fed stepping in make people more concerned (since they had to step in) or less concerned (since they did)?
The market came back a lot in the last hour today. I think the Fed stays home and lets things normalize a bit. Otherwise they are telegraphing/confirming worst fears, IMO. I might feel different by Monday morning, based on what happens around the globe and in the US in particular this weekend.