Why market goes down today, even US and Federal reserve has decreases the interest rate today??/?
Answers: Most money is created via private loans. The Federal Reserve's job is to make sure the private world keeps loaning money. "Open Market Operations", "Reserve Requirements" and the "Discount Rate" are the Federal Reserves tools for keeping the money flowing. Federal injections of money (by any of these means) equate to future inflation.)
The market goes down because injections equate to inflation and the people with money to invest are concerned that future inflation (coupled with taxes) will outpace there benefits from investing in a business activity. The investors are moving to real items (such as gold). Therefore, when the fed lowers rates, the private loans continue to shrink and job shrink. This is what is known as stagflation (interest rates and unemployment both increase).
Here is a good description of how the Federal Reserve manipulates the economy: http://www.a2dvoices.com/realitycheck/ma...
The US did not decrease the interest rates, just the Federal Reserve. They are not the same, the Federal Reserve is a privately owned corporation owned by wealthy international bank owners, 300 men to be exact and they hold private meetings around the world to devise how best to RULE THE WORLD, HA HA HA. Ok, sorry about that I could resist the humor of it. But it is true as crazy as it sounds. And Ron Paul had been trying to fight this, but the media (also owned by the same bank owners) try to make him out as crazy.
And this is why the economy still goes down hill:
The Federal Reserve (privately owned by international bank owners) prints money out of thin air, then lends it to the US government with interest, which is paid out of our income taxes, which is why the government is always in debt. The Fed does not pay interest. The Fed is not the government. "According to the U.S. Treasury, the Federal Reserve pays $20.60 per 1,000 denomination or a little over two cents for a $100.00 bill, is that correct. The Federal Reserve use the Federal Reserve Notes that cost about two cents each to purchase U.S. Bonds from the government."
So in conclusion, they are making huge profits off of the citizen's hard earned money and do not pay interest but charge interest. So the government and it's citizens stay in debt.
If you don't believe me:
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its stock analysis software C.D . helps to analyiz stock bazaarAnswers: Why don't you buy it? Seems like a biddable and honest investment.
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Can you explain the idea at the back the recent stock souk crash?
Please explainm the US federal reserve's announcement to cut the rates. what is 75 basis points?Answers: Most adjustment to interest rates are made in increments of 0.25% The Fed's most recent adjustments is 0.75% which surrounded by a single action hasn't happen since the early 80's.
The purpose of the rate cutback is to try and encourage spending as the US administration foolishly believe that they can spend their way out of the most modern crisis.
The reason for the souk reduction or crash depending on your perspective is twofold.
One, the sub prime mess cause by irresponsible US lenders who lent mortgages to people who really shouldn't enjoy had a mortgage. Once the cheap interest introductory propose ran out, these relatives found they could not afford their homes and defaulted on their payments. Unfortunately, these impossible loans had be repackaged and sold on to other financial institutions and amazingly, these companies don't actually know how several bad loans they own. As they are not able to accurately know their financial liability, they enjoy stopped lending to respectively other reducing the amount of liquidity in the system and making it difficult for companies or individuals to receive credit and thus spend.
Two, the US government have been spending profusely on defense and running up the national debt. Basically, when they need more money,they print it. By printing more money and not have it pegged to a commodity of unadulterated value close to Gold, the dollar has be devalued and consequently buys less resulting contained by prices going up which in turn squeezes consumers. Gas isn't going up because the grease costs more, it's going up because your dollar is worth less than it be last year.
More seller and less buyers.
I am not sure may be point .75%
first monetary crisis in US souk
second morgan stainley ,citibank facing heavy loss
third foreign investors took out their money from stock souk as they feared
n lot more consent to us get more answer gratitude 4 2 pnts
A basis point is one hundredth of a percentage point as stated approaching this..0.01% Therefore, 75 basis points would be 3/4 of a percentage point or .75 %
The rationale behind the recent stock marketplace pullback (I wouldn't call it a crash) is because investors sometimes frenzy and in this overnight case they are worried about the assets of definite companies in the financial sector concerning their mortgage assests such as CDO's etc. People are afraid that companies will lose profoundly of money and thus this could slow the economy. The federal reserve reduced rates to please Wall Street, companies and the market and at the same time lower the cost of cetain types of borrowed money near the hope that this will stimulate the economy. Nothing to verbs about unless you are planning to retire soon and adjectives your money is in the bazaar. If that is the travel case then you should manufacture some strategy adjustments to your portfolio or yak to someone you trust about financial matter. For younger investors, just sit rear legs and relax. This will pass surrounded by time and business as usual will continue. It's adjectives part of the ups and downs of the marketplace. It would be too easy if everything merely went straight up adjectives the time. Where's the challenge contained by that?
The recent stock market crash is attributed to the sub-prime mortgage crisis contained by US as well as the sell-off organize of foreign institutional investors(FII)
Let me explain you what US sub-prime mortgage crisis is then I can explain you the Fed rate cuts.
Take an example. Suppose you are living surrounded by US. You have see for yourself a great house which is priced at say 200,000 dollars. presently since you don't have such fluid money at a go, you buy that house on a mortgage, similar to home loan system within India wherein you pay monthly installments of some dollar amount. Now since inflation contained by US and greater taxes already add to the burden of local people's expenses, most of them couldn't afford to payment back the mortgage and this have resulted in crisis. Also, it is said that every American have at least 3 credit cards. Now, What Americans do? If they cant wage the bill of the first credit card, that apply for a second one and pay their first credit card bill through the second one. This also have led to further crisis contained by US which may trigger or I can say it is going to trigger another recession contained by their economy.
Now how did this crisis affect the Indian Stock souk? Simple. Most of the American banks which enjoy given out mortgages and credit cards have also invested contained by Indian stock markets as FII's. Now since they are facing a change crunch there surrounded by US, they decided to vend off adjectives their investments here to raise money and provide some relief to their currency crunch. This led to a massive downfall within our stock markets.
In financial calculation, 100 basis points = 1 percentage point or within simple terms 1 percent. consequently 75 basis points money 0.75 percent. The US fed have made announcement in Rate cuts so that the citizens who couldn't afford to pay vertebrae their mortgages now own a chance to wage them back at a lower rate, thus easing their burden and at least possible creating hope that there would be some nouns to the cash crunch they are facing.
I imagine you should know the followings.
1) stock shares just have its nominal value just. For instance, Many China corps issued new stocks contained by the markets at hand was a small description or indication of 50 times or 100 times exceeded its valid value.
2) Stock souk is not just sort of pooling approaching lottery tickets. You investors are gambling the numbering games. There are lots of making a bet in stock market, such as common shares, warrant shares, preferre shares, border investments, etc. These gambling trade name many losers vivacity in Hong Kong travel stale. Of course quite a few become super rich. The Hong Kong affairs of state is unethical and lustful and has wacky Hong Kong as the international scams of wherewithal. However, Hong Kon government collectd more than 2,000 billion dollars taxes surrounded by horse racing, soccer games waggering, and chiefly the duty tax from stock bazaar tradings. Why I hate Hong Kong command so much? Not just by design devised citizens addicted to gambling, they don't even provide prime pension for senior citizens. Many citizens found time is miserable in Hong Kong near the fruit fund of less than one hundred US dollars respectively month. Quite a few senior citizens starved to dead and rather a few had died of cold (just sbout 12 amount C). I think stock souk go crash is a right news for the frequent poor nations, extremely the under developed countries.
Many factor. One, there is a evolution in the intercontinental investment climate. One of the primary triggers is the huge fear of the United States' cutback going into a recession with foreign institutional investors trying to reorder their funds from risky emerging markets to stable developed market. Analysts are now expecting a cut within US interest rates.
Hedge funds and FIIs could have be the biggest sellers within the Indian markets, booking profits and making the most of the unprecedented bull run that have dominated the Indian stock market for a long time very soon.
The current volatility is also linked to worldwide bourses. There is a big correlation among global market. The presence of hedge funds across asset classes, along near increased global movement of possessions, has increased event-related volatility.
Volatility contained by commodities markets have also significantly affected equity market.