Fed Raises "Discount Rates" after Wed close of Expiry week---- after hours.
The market had been acting weirder than usual last 2 days. Do you think that news could have been leaked on the "inside".
But keep in mind this IS NOT the Fed Funds rates (kind of the bank to bank loan rate), but the discount rate...emergency cash when a bank needs a quick tide me over loan from the Fed.
The move was intended to move markets and it did.
Quick theory. US gov needs to sell treasuries, I heard over $100B next week. And Europe need to sell gold to keep Greece floating for a while.
So---bash the market with a surprise rate change after normal hours. I wouldn't necessarily take this as bearish, though. Big Ben might be gearing up for the next ramp job. In the brave new world, no one will be allowed to carry a negative attitude.
Jammermpu had this comment yesterday.
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Insightful and Useful Comment!