zalo

Beige Book, Black Picture

Regarding of the things said by the Fed Beige Book....who really thought that the 4Q was good for banks? It probably was the worst quarter of the whole 2008 by far. I don´t understand why people are so surprised. Stocks didn´t fall sharply for its own sake...they were telling that this was going to happen. The issue is, have the markets already incorporated the 4Q results plus the grim situation of 2009, or is the situation growing worser than originally expected?. With people already speaking about a depression, i dont know how can this be really worse.
Still, i think that governments have powerful weapons to fight this recession. Monetary policy have deployed powerful weapons and governments are delivering fiscal backstops. Governments must not worry now for their credit ratings (for now at least), they must fight the implosion of their economies.