As Stocks Tumble, Kocherlakota Urges Fed To Cut Rates Immediately
That didn't take long.
Just a few days after stocks hit an all time high amid investor complacency that China's ever more audacious lies about the declining number of new coronavirus cases confirms that Beijing is on top of the domestic epidemic, and even if they are not, the Fed will step in and cut rates or do more QE - because somehow printing money and printing antiviral antibodies is comparable - stocks plunged as it became abundantly clear that the coronavirus pandemic is not only not fading, but on the contrary, it starting to spread around the globe with new clusters emerging in South Korea, Japan and Italy.
And with stocks crashing and the Dow dropping over 1,000 points, suddenly the complacency that "all is well" was shattered with a hammer.
Which leave the Fed, and lo and behold, with the S&P just a fraction away from the all time highs it printed just last week despite today's tumble, central bankers have emerged from their caves and are already calling for the Fed to cut rates. Case in point, former Minneapolis Fed Narayana Kocherlakota (what is it with Minneapolis spawning the biggest uber-doves in history?) has penned a Bloomberg op-ed in which the only FOMC member who was the first and only Fed member to put in a negative dot on the Fed's dot plot, said that the FOMC shouldn't wait until the March 18 FOMC committee, and should in fact conduct an intermeeting cut "to deal with this clear and pressing danger" adding that he "would urge an immediate cut of at least 25 basis points and arguably 50 basis points. That’s a cheap insurance policy for the economy that the Fed shouldn’t pass up" even though as he says in the same op-ed "it isn't clear how much economic damage the virus will do. "
https://www.zerohedge.com/markets/stocks-tumble-kocherlakota-urges-fed-immediately-cut-rates-because-coronavirus