Ford chief urges Fed action (Emaciated corpses litter streets!)

http://money.cnn.com/2007/08/24/news/companies/ford_fed/index.htm?postversion=2007082406 ^ | 8-24-07

[Petronski]

You act as though economics haven’t been explained to you.

Willful ignorance is a terrible thing.

[Southack]

"No we at this point need to stop inflation that is concern one."

Why do you think that housing prices are increasing? That's inflation.

[Petronski]

No we at this point need to stop inflation that is concern one.

Not even close.

[Moonman62]

What’s wrong with setting the funds rate to be in line with other market rates? By definition market rates aren’t cheap or expensive.

[RC30]

He’s too busy supporting Gay Pride Parades. In the midst of his company’s downfall he’s been catering to homosexual organizations at the expense of Christian Conservative’s. I don’t have a problem with supporting what they want to support with their own money, but using Ford’s name and money to further the homosexual agenda is blatant arrogance.

[Hydroshock]

Because any type of banker bail out at this stage will only worsen the coming recession. And worsen inflation.

[Southack]

Dude, we don’t have inflation!

Why do you keep repeating nonsense?

You act as though you are married to inflation.

[Petronski]

Because any type of banker bail out at this stage will only worsen the coming recession.

LOL

[Hydroshock]

Yes we do, look at food look ath enegry cost over the past 2 years.

[Chanticleer]

I'm not sure I follow you. The fact that the Fed sets rates at all is an obstacle to a pure free market, whether they raise or lower their rates.

I don't see that interest rates are all that high. You can still get a mortgage in the 6% range. When we bought our first house in 1986, we had the low interest rate of 8%. It's been much worse at other times.

When interest rates are low, consumers tend to overextend themselves and save less. Low interest rates do increase demand, temporarily boosting economic growth. Increased demand for dollars and a reduction in savings should automatically drive up the price of borrowing, but the Fed prevents that to some extent. Eventually, people run out of things to buy or the ability to meet debt obligations. Then, there's hell to pay.

[Southack]

"Yes we do, look at food look ath enegry cost over the past 2 years."

That was then. I'm talking about NOW!

The danger right now is that we have deflation: housing prices plunge...liquidity is scarce...etc.

Interest rates were what they were for 2 years ago. We're talking about what interest rates should be for today and tomorrow, instead.

[Dems_R_Losers]

How the hell is a reduction in the federal funds rate a "banker bailout?"

The market has already spoken about interest rates by driving down the short-term T-bill rate to near 3%. Investors certainly are more concerned about recession and a credit crunch than they are about inflation. Do you think the markets are wrong this time?

[Hydroshock]

Housing prices need to fall and in some areas they need to fall hard. The substainable ration between family income and the cost of a hosue is about 1.5 to 2.5 years of income to the cost. This is totally out of wack in amny areas.

[Hydroshock]

Yes, inflagtion it the paramount concern.

[Chanticleer]

Energy costs are high due to many factors, including increased demand from China, the war in Iraq, and the fact that we aren't building refineries in the U.S. Increased energy costs affect the cost of virtually all products.

To combat the rising prices, should we manipulate interest rates, or should we start building refineries, reducing our energy consumption and producing alternative methods of energy? The first alternative is easier, but the others are the only ones that will be effective in the long run.

[djf]

It was the easy money policies of the Fed that caused the problem.

Now folks are screamin for more of the same.

That’s the same as trying to put out a fire by dousing it with gasoline.

[Hydroshock]

We do need more refineries and work on alternative sources of energy.

[Chanticleer]

Absolutely!

[Toddsterpatriot]

Because higher prices (inflation) are bad, he thinks that lower prices (deflation) must be good. And bankers are evil.

[Hydroshock]

Exactly, they are not thinking long term but just want to get prop it up for a while longer.