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9/11 - The Real Cause Of The Current Crisis?

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These are the minutes of the Fed's conference call following 9/11. http://online.wsj.com/public/resources/documents/Fed20010913ConfCall.pdf

Greenspan was less keen on making an immediate interest rate cut that some of the other chairmen but said this:

Moreover, I think any beneficial effects that might come from reducing the federal funds rate target are going to be in terms of reassurance and the psychological aspects rather than that a reduction of a certain number of basis points will make an enormous direct contribution. That doesn’t say that I rule out a funds rate move by any means; I think being ready to make a move could be very important. My instinct, from what I know, is that such an adjustment is not necessary or required at this point. But I’m sure that you know a lot more than I can see out here in St. Louis. If a step looks advisable, I certainly don’t rule out a cut of 50 basis points, although from a reassurance point of view it seems to me that 25 basis points would perhaps be enough. Of course, I say that with the understanding that it would be easy to do another 25 basis points either very quickly thereafter or on October 2 at our regularly scheduled meeting. That summarizes my view, but I feel very strongly that it is critical that we be ready to respond to events almost hour by hour. And I would support whatever decision might have to be made under the present circumstances.

In the event, they slashed rates from 3.5% to 1.75% before the end of the year and I'm sure the feeling that allowing a slowdown would be to let Bin Laden win weighed on monetary policy decisions during the initial 'war on terror'.

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These are the minutes of the Fed's conference call following 9/11. http://online.wsj.co...913ConfCall.pdf

Greenspan was less keen on making an immediate interest rate cut that some of the other chairmen but said this:

In the event, they slashed rates from 3.5% to 1.75% before the end of the year and I'm sure the feeling that allowing a slowdown would be to let Bin Laden win weighed on monetary policy decisions during the initial 'war on terror'.

A warthog farting in Papua New Guinea was excuse enough for Greenspan to cut rates. Any catalyst was bound to have done it, 9/11 just happened to be the one.

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  • 334 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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