Fed Rate Cuts Inject More Uncertainty into the Markets

52-week lows unemployment claims coronavirus3844328 / Pixabay

Biblical investing authority Dan Celia is summarizing a very turbulent economy and last night analyzed the Federal Reserve’s actions over the weekend with a focus on the public health crisis aspect.

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Fed Cuts Short-term Interest Rates

“The Federal Reserve has decided to cut short-term rates to between 0% and .25%, basically removing any ammunition we had left now that we don’t have any dry powder,” Celia said Sunday night. “Powell decided to add $700 billion worth of quantitative easing (QE) into the credit markets. I believe the Federal Reserve is saying that we need more fear in the markets, more uncertainty and that the economy is far worse than anyone thought. Powell has all but guaranteed that the U.S. will be in a recession and has decided that we would be better off if we looked exactly like our European allies, with declining currency, increasing debt and recession.

“Obviously, he’s not really saying those things directly, but certainly it is what’s being taken by the markets, and that’s why we saw the futures market take such a dip on Sunday evening,” Celia continued. “This was a horrible move by the Federal Reserve, unless Powell doesn’t really believe that the coronavirus is a problem or that lower oil prices are the problem. Are those two black swans not transitory at all? The Federal Reserve does not step into the market because of transitory or temporary issues. So, are we to believe all this is transitory and that as soon as it’s over, Powell will raise rates again? That will not happen. We have a rough few weeks ahead of us, no doubt about it.

This Is A Public Health Crisis

“Let me summarize what is happening in the economy very quickly,” he added. “We are going through a public health crisis. We are not going through a market crash or an economic crash. When this public health crisis is over and oil is stabilized, markets will recover. This is likely the first time in the history of the Federal Reserve since 1913 that it felt it necessary to intervene in a public health crisis.

“Or could it be there is a lot more to this economic downturn than meets the eye? Something like irrational tightening of credit and liquidity markets could that possibly be exacerbated because of $21 trillion worth of debt with federal spending hitting new record highs. Maybe the financial sector and the shadow banking system have more debt and risk with less equity than anyone ever imagined? I started talking about that very thing three years ago, and I’ve been talking about it since. It’s the last thing I want to be right about. I am hoping the Federal Reserve is not using this public health scare to get ahead of a curve that no one wants to talk about. Again, I hope I am wrong about that.”

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About the Author

Dan Celia
Dan Celia is the CEO and President of Financial Issues Stewardship Ministries. Married to Registered Nurse, Yvonne, in 1980, Dan has two married daughters, is blessed with sons-in law who love the Lord, and has seven grandchildren. Dan has worked for 35 years as an entrepreneur and businessman, starting eight corporations and co-founder of two others. In 1999 Dan sold his Small Trust Company (managing over 900 million dollars) to go into Ministry. Dan has developed and uses a biblically-responsible system of financial management with great success. He started a radio ministry in 1997 as a part time ministry and has seen the Lord expand and bless this ministry to his current full-time ministry. Dan has interviewed newsmakers and pundits like Steve Forbes, Ben Stein, T. Boone Pickens, Tony Perkins, John Alison, Rayola Dougher API, Congressmen, Senators and Presidential candidates. He is proud of his partnership with the American Family Association where he serves as a board member. Dan is now on over 640 stations three hours daily, NRB TV, BizTV, Dove TV and CBN Life Style Network. Financial Issues is heard in every state in America and throughout the internet globally. Financial Issues has supporters from over 17 countries. Dan is a Regular Weekly Contributor to Townhall.com (the number 1 source for conservative news and analyzation). Dan has been a guest on Fox Business, Bloomberg, Salem Radio, Family Net, 700 Club,and many others . He is a conference speaker, author of six books, publishes a weekly newsletter and has been Executive Producer of several video productions and FISM TV is producing original family friendly content and other video projects all keeping with in FISM’s Christian world view.

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