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Tuesday, September 18, 2007

Economic Pillow Talk in the Offing

The Fed is expected to kick the can down the street in terms of having the economy assimilate the deflating housing bubble by cutting its target for the federal funds rate, the interest that banks charge each other, for the first time in four years.

This action by the Fed is deemed necessary to offset the credit crunch caused by the surge in delinquencies in subprime mortgages that followed in the wake of the inevitable bursting of the housing bubble that was created by... the Fed. There's a subsidiarity lesson in here somewhere.

Anyway, it's time to dust off the book of Fed Chairman clich├ęs... brace yourselves for a "soft landing."

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