For days, the markets begged the Federal Reserve to cut interest rates, to stanch the bleeding stemming from the coronavirus outbreak.
Last Tuesday, the Federal Reserve delivered. And the stock market immediately went into a tizzy, gyrating well over 1,000 Dow points, with most of those dazed dance steps well in negative territory.
OK, the markets’ reaction probably was exaggerated in substantial part because they had set record increases just the day before, following historic declines over the preceding week. Buy on the rumor in a frenzy, sell on the news in a deep funk, perhaps. Or maybe the Monday gains were just a reflex bounce from so much lost altitude over such a little time before, with the next day preordained to fall further.
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