Interest Rate cut By FED to feed hungry wolf

As per media requested, FED on Friday, 17 Aug 2007 has been reduced the interest rate. It was indirectly informed the finance market, the sub prime loan defaulting brought a very serious impact.

FED in the last few years has increased interest rate to control the inflation. It does not bring any good effect because of the global economic issue. It does not bar economic slowing down and further encourage fund manager manipulate the carry trade. Fund manager eyeing on how much the reward received in their pocket rather than evaluate the quality of the finance product.

FED has a pressure by media. They are not based on market requirement to operate the finance system. They worry the analyst and reporter critics them. Soon of the later, economic down turn may come because of FED never clean the rubbish or poison in the finance market now further helps dirty people rescue the giant crocodile. It created a certain number of millionaires to maintain position by scarify of hard earn money from ordinary people.

In my school time, the basic economic telling me interest rate is a weapon to control unbalance of economic. But in my view since global economic concept launching in this century, interest rate become a poison because the difference rate applying by difference central bank assist the giant crocodile more chance to manipulate the economic on particular country. Furthermore assist by internet services, the speed of circulation of the hot funds easily turn around in every minute from one place to another place to grab a higher yield. Finally brought interest rate now becomes a middleman or wolf to eat one stable economic base by a second time.

At this moment, I think FED never realise number of people does not fulfil the housing loan finally will lose their home. The basic living requirement has been eliminate by people who playing the finance game. Without a home how to be a strong country. FED should brings all the money to build the home for poor people instead of helping the giant crocodile accumulate the wealth by a minute or second.

FED should consider: -

a) Why the loan can easily obtained by sub prime mortgage?
b) Why the product can be resell several times?
c) Is it the reward system operated by finance company brings any bad effect?
d) Is it the loan has been multiple registered into finance company turnover?

FED also should realise every building strong/weak depend on the constructing a basic structure/piling. The interest rate cut or injected fund means seem like putting the cement to cover the hole in middle of building. It does not helpful but temporary ignoring the fact only. After cutting interest and injected funds, final result was we could see few funds declared bankrupt. It has a very good excuse for them claim again that the funds not enough or interest rate still high. It already diverts the attention of people claiming who is a beginner. Everybody forget the creator of the crisis, central bank carry another pressure again must reduce interest rate again as per wolfs request. Otherwise, the stepping down issue may arise to FED chairman.

In the beginning stage a lot of people in doubt. “Why central bank never identified who is the investor of the specific funds? This is a simple job by FED. While inspection into list of the investor in the hedge fund, you can easily know that the group of people is rich man. Last few years, they were grabbing the high yield and return from poor people. Now, little lost by dirty trade by them start looking for central bank must help them to take back the dirty funds. Thus, rich still rich and poor still poor. Balance of economic still out of control. So, What is next step to do? Or, What is effectiveness of interest rate cut in today? The hungry wolfs never stop end to demand. FED can feed them how many times?

Like Malaysia, always has one super hero claimed that collapse is not his problem. Problems are due to short of funds. Inspection is not his duty. Hence, Every collapse happen he was immediately open his mouth that required how much and how many dollars to repair.

So, essential or basic problem year by year covered. Until one day, more people die in the crisis only realised all the method is wrong. But fat wolf is standing beside and laugh.

Interest rate is a weapon of FED to control the economic temperature. But misuse it by giant crocodile to manipulate the market become a serious matter.

FED has numbers of good and intelligent man. I believe they all smarted than me 100 times. I hope that FED people should understand I as an ordinary people, investment is our retirement support. Hence, giant crocodile eat me like that. It is totally unfair.

Of course, like me as an ordinary people only stay away to watch show. No any rights and enough qualification to say anything bad method adopting by FED. But, I believe the final economic data will tell us. This step is right or wrong. It always will justify by market force.

Write by Kacaubusy on 20 Aug 2007.