"I think the Fed is bonkers" - a slightly different view of the Fed rate cut via Germany's Spiegel

there seems to be a lot of this "bonkers" stuff going around these days...

from spiegel online...

Within the space of two weeks, the federal funds rate -- the rate at which banks lend each other money -- has been dropped by 1.25 percentage points. It's a record intervention, one which simultaneously sparks both hopes and fears.

"The Federal Reserve is obviously very nervous about what is going on in the financial system and the housing market," said Mark Zandi, chief economist at Moody's Economy.com, in remarks to the Associated Press.

Some analysts were unsparing in their criticism of the move. "I think the Fed is bonkers," Allan Meltzer, an economist at Carnegie Mellon University, told the Los Angeles Times. Fed officials "frequently swear to themselves and to each other that they are not going to ease (interest rates) excessively, and then the economy slows a little and they do just that," he said.

you gotta believe the fed is scared as hell to be doing cuts this drastic and over such a short time interval...

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