Links: 2008-12-18 – more on ZIRP
Now that the United States has cut its interest rates to Zero and Ben Bernanke has helicopters flying over Wall Street, the question is: what happens next and who’s following the Fed to zero? There are a lot of different answers.
- The Dollar is going to get pounded – disorderly fall.
- The British are next to ZIRP. The Pound is dead meat.
- The Swiss are next to ZIRP.
- The Japanese are going to start selling Yen into the currency market.
- The Europeans have huge exposure to Eastern Europe and those bets are about to go pear-shaped. The Euro will tank.
Take your pick. It’s anybody’s guess really. We are in unchartered territory.
p.s. – anyone know what’s happening at Glencore. I see their CDS spreads going berzerk and talk about lack of liquidity. E-mail me if you have any answers.