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Thursday, January 15, 2009

ECB cuts rate to 2%

http://www.ft.com/cms/s/0/0f1cc64c-e2f5-11dd-a5cf-0000779fd2ac.html

I like Trichet's style, he says he will never cut rates, then cuts rates and then, says, he is wary of taking them too low--keeping the crowd guessing, is a good thing.

Surprising the market, evoking a positive psychological response, works well--it balances out the short term speculators, and gives stocks a chance to rally amidst new and fresh capital with long term forecasts, optimistic about overall deterioration.
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