Will the Fed cut rates? That is a question that was asked to me on Labor day. My unqualified opinion is not will they, but what happens if they do? Right now the markets are discounting a cut, so will it be a sell the news type of reaction? Will a 25 or 50 bp cut really effect the credit markets? Not really, but supposedly it will be a psychological buffer. All I have been saying is stocks got cheap, Bear Stearns did not go out of business, and fear ran real rampant on a 7% pull back in the indicies. If you are playing the home game, I would lock in some of those short term trades by the end of this week in time for Fed Watch 2007.
By the way, $%^* Appilation State.