Fed cuts rates again but . . .

According to a CNN poll, two out of three respondents think the Fed's rate cuts have not helped the economy, from a total of 32,304 responses to the poll. I realize this doesn't require anything more than attentiveness to the economy and what the Fed has done, but it is a good sign. Now, if only those two-thirds will graduate to the view that the Fed is hurting the economy by manipulating interest rates our descendants might have a bright future.

As mentioned in this blog on October 31, Frank Shostak said if the Fed cut rates to zero it

would underscore the reality that the Fed is incapable of producing wealth from its printing press. It would show that the Fed is completely powerless, except to produce mis-signals that generate malinvestment. The only thing that might temporarily move is the stock market.

The rate cut was not quite to zero. A target rate of zero would be admitting utter futility, so Bernanke and his gang will keep the Fed Funds Rate between 0 - 0.25, which is almost utter futility. That's not zero. Don't anyone say it's zero, because it isn't. Still, Wall Street came through.

Stocks surge after the central bank cuts a key interest rate to the lowest level on record.