Judging by the market reaction following the Bernanke speech this afternoon, he didn't bring hope to the bulls. The indices jumped in anticipation with the Dow in triple digits. Those gains evaporated soon after. What is Ben supposed to say or do ? Staving of a recession at this point is a highly unlikely scenario. Cutting rates further will only be inflationary. It won't save the markets or the consumers. The Fed should just stay put and not cut rates any further. It will only lead to stagflation - slowing growth with rising inflation.
The plus side is the spikes in gold and silver. GLD and SLV are looking pretty today. I can't help but feel commodities will be the way to go in 2008 as every rate cut only leads to further spikes in commodity prices. Gold and Silver along with agriculture could easily rise 30% or more in 2008.
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