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Fed cuts half point in emergency move amid spreading virus

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Re: Fed cuts half point in emergency move amid spreading virus

#471

Post by andrekandre »

x86_64Ubuntu wrote: post #435
seanmcdirmid wrote: post #362

Earlier quoted context omitted.

Which should have happened along time ago in the current economy but haven’t, you can’t cut rates in bad times if you don’t raise them enough in good.

I'm an economic idiot, but the interest rates have started concern me. It's seemed like no one wants to cut them as that might put the brakes on "growth". There are also rumorings of a crash being around the corner. So if a crash does come about, what's the Fed going to do seeing as how rates are already bottomed out?

> So if a crash does come about, what's the Fed going to do seeing as how rates are already bottomed out?

potentially, negative interest rates, that’s what [1]

[1] https://www.investopedia.com/articles/investing/070915/how-n...

Re: Fed cuts half point in emergency move amid spreading virus

#472

Post by ericns »

mumblemumble wrote: post #208
derrick_jensen wrote: post #186

Earlier quoted context omitted.

To be fair, within the Constitution there is a clause where the Gold standard is required for all debts and tender ( https://en.m.wikipedia.org/wiki/Contract_Clause ), of which Thomas Jefferson wrote the majority. Even if he didn't say it himself, the sentiment was strong enough between all parties that it was included in the beginning.

It's worth noting here that The Wealth of Nations was published in 1776. Perhaps the people who drafted the US Constitution would have had a chance to read Smith by 1787, but I can't imagine they would have really had a chance to fully digest and internalize the ideas being presented. They were almost certainly working from a firmly mercantilist mindset.

It's more like they were familiar with the Theory of Moral Sentiments^. This work lays out the foundation of the Wealth of Nations and lays out an explanation of The Invisible Hand. From the Section 'Sixth Sense':

"Hutcheson had abandoned the psychological view of moral philosophy, claiming that motives were too fickle to be used as a basis for a philosophical system. Instead, he hypothesised a dedicated "sixth sense" to explain morality. This idea, to be taken up by David Hume (see Hume's A Treatise of Human Nature), claimed that man is pleased by utility. "

I think this is one of the first places to move away from a labor theory of value to a utility theory of value. I'm a dummy though so who knows.

Edit: Publication on or before 12 April 1759 should have had plenty of time to be read and discussed before the Contract Clause?*

^https://en.wikipedia.org/wiki/The_Theory_of_Moral_Sentiments

Re: Fed cuts half point in emergency move amid spreading virus

#473

Post by stevenwliao »

howlin wrote: post #16
vnchr wrote: post #11

The Dow finished up 1,294 points yesterday, making it its best one-day point gain on record.

It's best to follow the SP500 rather than the Dow. The former is much more representative of the whole market. And it's best to follow market movement in percentage rather than points. Points inflate over time as the nominal value of the market indexes climb.

I can't wait for the SP500 to replace the Dow in news reporting.

Re: Fed cuts half point in emergency move amid spreading virus

#474

Post by fauigerzigerk »

gdubs wrote: post #468
fauigerzigerk wrote: post #461

Earlier quoted context omitted.

I said myself that I didn't believe the cruise ship numbers were representative, but the 20% figure you cite isn't a realistic hospitalisation rate either as it only includes diagnosed cases. The number of undiagnosed cases is the great unknown that experts disagree on. It's also the basis for all the wild speculation out there. Under normal circumstances I would say let's test a random sample of the population in so…

The same is true for the flu. People get it every year but they don’t go and get swabbed. I also agree that there’s a wide range of possibility. But I’m responding to the claim there’s no data with a study from China’s CDC that most experts are citing as the best info we have right now . Is it perfect? No. But the Diamond Princess isn’t a scientific study — it’s a mess. Edit: for a range of possible outcomes, this ar…

The 20% figure is not an imperfect estimate of the true hospitalisation rate. As far as I know the study didn't even attempt to estimate the true number of infections or (by implication) the true hospitalisation rate.

Re: Fed cuts half point in emergency move amid spreading virus

#475

Post by airstrike »

rory096 wrote: post #386
airstrike wrote: post #88

Earlier quoted context omitted.

Sorry and thank you – I meant to say fiscal or monetary specifically in the near term, meaning supply chain disruptions take much longer to undo. I've edited my post accordingly.

The near term is precisely what monetary policy affects...

Near term sentiment, but it can't undo the Coronavirus

Re: Fed cuts half point in emergency move amid spreading virus

#476

Post by liuliu »

OscarCunningham wrote: post #334
liuliu wrote: post #17

Earlier quoted context omitted.

It can go negative, or Fed can do another round of QE, there are plenty of tools. The real question is whether the deficit can grow indefinitely without consequences, and if this is a moral hazard (e.g. no risk priced in borrowing).

What does the deficit have to do with the Fed? QE doesn't grow the deficit.

Deficit is funded through debt (treasury notes). Fed buys treasury notes (through QE) and sets the interest rate on these debt. Lower interest rate in short-term reduces deficit (smaller coupon payment), but in longer-term encourages borrowing.

Re: Fed cuts half point in emergency move amid spreading virus

#477

Post by debaserab2 »

lawrenceyan wrote: post #439
wpietri wrote: post #346

Earlier quoted context omitted.

I think there's an enormous difference between "I have some polite questions about your level of expertise" and "I will repeatedly jump on a possibly-innocent error". I will note that airstrike is not "unable to differentiate the two". They have quite clearly gone on to demonstrate that ability. It is important to make sure false information doesn't circulate. But I don't think that excuses being "harsh".

Ahh, I see. I think I understand the confusion now. I believe our primary disagreement here lies in the fact that you don't see /u/airstrike not differentiating between fiscal and monetary policy in his/her original comment, as a major red flag, whereas from my perspective I do. Please correct me if I'm wrong.

Stand up. Take a big stretch. Do something besides the internet for a few hours and then think about what you’re typing.

Re: Fed cuts half point in emergency move amid spreading virus

#478

Post by learc83 »

gdubs wrote: post #454
learc83 wrote: post #420

Earlier quoted context omitted.

We don't have any idea what the hospitalization rates are. We only know what the hospitalization rates are for people who have a confirmed diagnosis, which skews towards people with severe symptoms. >Also, the cruise ship cases aren’t all resolved outcomes yet. No they aren't, but the vast majority have been symptomatic longer than the average time till hospitalization and the number in critical condition hasn't incr…

Except we do have data, that’s my point. China’s study is being cited by most experts as this situation unfolds. It doesn’t mean these numbers will hold — it’s possible that what we see out of South Korea over the coming month might be more representative — but it’s what we have, and it’s not nothing: http://www.cidrap.umn.edu/news-perspective/2020/02/study-720...

The data can't support your 20% hospitalization claim though, and no one in public health is using that study to make that claim. The study itself makes no such claims that this study is in any way applicable to the general population.

About 40% of the patients in that study weren't even tested. They were included based on symptoms that include severe pneumonia. The ones who were tested, sought testing because they displayed symptoms severe enough to seek treatment.

This is the very definition of selection bias, and there is absolutely no reason to pretend that a 20% hospitalization rate is a realistic outcome.

Re: Fed cuts half point in emergency move amid spreading virus

#479

Post by learc83 »

gdubs wrote: post #468
fauigerzigerk wrote: post #461

Earlier quoted context omitted.

I said myself that I didn't believe the cruise ship numbers were representative, but the 20% figure you cite isn't a realistic hospitalisation rate either as it only includes diagnosed cases. The number of undiagnosed cases is the great unknown that experts disagree on. It's also the basis for all the wild speculation out there. Under normal circumstances I would say let's test a random sample of the population in so…

The same is true for the flu. People get it every year but they don’t go and get swabbed. I also agree that there’s a wide range of possibility. But I’m responding to the claim there’s no data with a study from China’s CDC that most experts are citing as the best info we have right now . Is it perfect? No. But the Diamond Princess isn’t a scientific study — it’s a mess. Edit: for a range of possible outcomes, this ar…

> The same is true for the flu. People get it every year but they don’t go and get swabbed.

But with the flu we have large population studies, so we can estimate the number of likely infected based on the number seeking treatment. They study you are citing can't be generalized, and no one but you is claiming it should be used to estimate hospitalization rate.

Public health officials who are trying to produce estimates are using that study along with models of how many un-diagnosed cases might be out there to try to predict hospitalization rates. But they aren't naively throwing out your 20% number.

>But I’m responding to the claim there’s no data with a study

There is no data to support your claim of a possible 20% hospitalization rate. None, it doesn't exist. There is data to support a 20% hospitalization rate among people sick enough to seek treatment, and people sick enough to be clinically diagnosed.

>at the extreme high Iran, and Italy aligning roughly with China’s study.

Italy and Iran also likely have far more actual cases than confirmed.

>No. But the Diamond Princess isn’t a scientific study — it’s a mess.

The study you are presenting makes no attempt to predict the actual hospitalization rate among the general population. And the samples aren't random. It's more a mess than the numbers from the Diamond Princess.

Everyone on board the ship was tested, no sampling bias there. But even then, there is selection bias because the ship's population is older than the general population.

Re: Fed cuts half point in emergency move amid spreading virus

#480

Post by kube-system »

qeternity wrote: post #372
kube-system wrote: post #353

Earlier quoted context omitted.

Who do you hire when you're at full employment? (The answer is you have to increase immigration, and hire those people)

Well for starters you stop reducing the participating rate to make things appear better.

The participation rate isn't set, it's measured.
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