Tuesday, January 22, 2008

Wake Up Call

I just talked to my Mother. I've been advising her on an exit strategy for her long positions. During the conversation she mentioned that she was surprised by the emergency rate cut today and noted that "wow, things must be really bad".

Like a majority of Americans, the reality of the credit crunch hasn't penetrated into my Mom's everyday life. So it seems that the Fed's cut, while easing Wall Street's fears, has just given Main Street something else to worry about (as if the falling price on their home wasn't enough).

Goodbye American consumer. It was a good run.

Mark Hulbert talks about this unintended consequence in this interview.

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