I almost hate to point this diatribe at Trump, because it could also be pointed at any number of "free marketeers," most notably Larry Kudlow, who expresses similar sentiments every day.

Just a minute or two ago Trump commented on CNBC that the recent Fed interest rate cuts were great, but that there's a problem. The problem is that every time we cut rates (ie, dilute our currency), the oil producers raise prices to compensate themselves for the loss of value experienced due to our payment in a currency that is worth less and less every day.

Trump's solution: We need leadership. We need somebody who's going to go "over there" and tell "those people" what the price of oil should be. We need somebody to tell them "how it's going to be."

Sorry Trump, Kudlow and the rest of you. Welcome to the free market you all claim to love, sometimes it bites.

As Jeff Matthews noted some time back, you can learn an awful lot by reading your mail.

What's my mail telling me now?

• Credit is still quite available if you have a good credit rating. Rates aren't even that mucch higher. The offers keep piling up. As Jeff Saut noted a few weeks ago, we've been experiencing a collateral crunch, not a credit crunch. Those who have decent collateral have access to credit. New offers show up every day.
• The satellite radio companies are in trouble. Sirius (NasdaqGS:SIRI) has been spamming me by email, phone and snail mail over their recent and recently-extended promotion to receive a second receiver free. I already have two of the things: one in the car and one portable, yet they have spent a significant chunk of money to try to get me to buy a third. Using expensive phone and snail-mail marketing directed at existing shareholders is not a sign of a strong growing market. My guess is that increasing penetration into the vehicle markets is not helping all that much, and the other "low hanging fruit" are already on board as well.

  So they're spamming guys like me hoping that we'll buy a second, third or fourth receiver for a friend, girlfriend, or somebody else who won't pay the full purchase and subscription fee, but who might be willing to piggy-back on an existing account for $6.95 per month. It's effectively an admission that the prices they have been charging are too high for a large segment of the potential market. The stock has popped a bit recently, and I'd be selling if I owned. The possibility that a merger of Sirius with XM radio (NasdaqGS:XMSR) is the primary factor that would keep me from being short the stock at this point, though I think that one is still likely to be a non-starter.

• American Express (NYSE:AXP) wants me to use my Membership Rewards points on new promotions by their home decorating and other retail partners, including Bloomingdales, Home Depot, Restoration Hardware, Crate and Barrel, Linens and Things, Saks, Fortunoff, Pottery Barn and Williams Sonoma. They're also offering me double points on all purchases at Fortunoff and Home Depot. Historically, these deals have been offered when things are weak for the promoted companies. I'd take any positive statements about the condition of retail in general and home decorating/renovation chains in particular with a grain of salt right now.
• The letters and postcards from Miami realtors got increasingly desperate until about two weeks ago, then stopped completely. Guess they all went back to being strippers or something. A bottom? Wouldn't bet on it just yet.

-btc

Wrong for everybody except private equity managers, hedge fund partners, bankers and other wall streeters, that is...

• Jeff Matthews plays a game of Jeapordy that Ben Bernake would lose.
• Mish sees this as part of an overall move by governments around the world to try to enforce "stablity," (eg, protect the powerful) even if it means manipulation of markets and everything else, in a manner that only guarantees more instability over the long haul.
• Kevin Depew's "Five Things" today is right on the money, as usual. As Toddo always notes, it's the best read on the street.
• Barry Ritholz points out the possibility of a "nuclear winter" for the dollar, something I've been worried about for some time.

In the real world, my small positions in metals and materials more than made up for losses elsewhere today. GoldenStar (AMEX:GSS) led the pack, up 15% on the day. Central Fund of Canada (AMEX:CEF), which mostly holds silver and gold, has also finally regained some traction. I continue to hold, as I don't believe this move is over and is punctuated by a silver breakoutabove both its 200DMA and the recent downtrend line.

Quint Tatro on Minyanville thinks the Silver ETF (AMEX:SLV) is buyable here and worthy of building a long-term position.

-btc

Nice to come back just in time for a petty academic/bureaucrat with far too much power to do something stupid and self-serving and give me an opportunity to vent a lot of rage. I'm not the only one.

• Doug Kass over at Realmoney (subscription required to see the whole piece) thinks it will do nothing to help, and may even hurt, echoing my comments earlier today:

  The U.S.'s economic problem lies firmly in the consumer/housing market, and the larger-than-expected rate cut will likely promote more inflation, a downward spiral in the U.S. dollar and, most importantly, will likely raise intermediate and long-dated bond yields.

  The latter point is the most important, as this will serve to further cripple the housing market by raising mortgage rates -- especially for those who are facing an imminent reset.

• Mish points out that this Fed move was apparently aimed at nothing other than bailing out their banking buddies, at the expense of pretty much everybody else.
• Even Cramer is a bit more subdued than yesterday, claiming (probably correctly) that you can't short into this and have to ride the rally, but using a lot less hyperbole when talking about the effect on homeowners facing mortgage troubles.
• Angelo Mozillo, at Countrywide Loansharks, thinks that Fannie Mae and Freddie Mac should raise their loan minimums to $850,000 in order to help deal with the "jumbo" morgage shortage. Hey Angelo, if those mortgages are such great deals for the US taxpayer, why aren't you rushing in to put your own money behind them? Oh yeah, you made your money by getting the taxpayer to take on all of these ridiculous risks and charging us transaction fees, not by actually taking any risk yourself. How silly of me to believe that in a capitalist market, prices (including loan rates) should be set by people who are willing to put their money where their mouths are, not by petty bureaucrats and politicians shoveling it your way...
• I'm increasingly of the belief that Cody is right. Sudan is a better investment than the US. At least their bureaucrats are more honest about the fact that they're just helping their cronies, rather than claiming that they're doing it "for the good of the country."
• By the way, congrats to Cody for landing an anchor gig at the coming Fox Business Network.
• Jeff Macke delivers sage advice. No matter what you think of the long term implications, you just can't be short:

  You can rage against the long term implications of this unified stance of money dumping but, from where I'm sitting, being short here seems like picking a fight with both the Fed and the tape. I'm inclined to take some profits, fret for the future and wait for lower prices to add more longs to my book but I'm not at all interested in shorting this tape.

• And Barry Ritholtz sums things up nicely by pointing out that Bernake and the Fed have now given up any real claim to being an independent agency. They are now simply Wall Street's Bitch.

Myself, I've judiciously added some positions in materials-related stocks and other non-dollar senstive areas. I think that you just have to avoid anything senstive to the US currency, and if you're inclined to have cash, it's got to be the cash of some country other than the US.

-btc

Since yesterday, rates on the 10 year treasury are up. That's not going to help mortgages.

Ultimately, this was just a bailout for the rich and powerful, with "people in foreclosure" as the excuse. The people in or close to foreclosure will not be helped. The people who took out mortgages with low teaser rates or reverse amortization terms will not be helped. Only the people who borrow money to leverage questionable assets and then award themselves large fees for taking irresponsible risks will be helped.

Yes, the market will "unfreeze." But really it has not been frozen. People and companies with good credit and responsible habits and capital structures have not been impacted. Companies that sought to "enhance shareholder value" by using all their cash to buy back stock, borrowing even more to buy back more stock, and then depending entirely on commercial paper for working capital because they have no money in the bank found themselves frozen out. There's a term for what those companies did. It's called "irresponsible risk taking." The payback should be a whole lot of CEOs losing their jobs, and a whole lot of private equity investors and "activist" hedge funds losing their shirts for being so short-sighted. And the markets for those bad debts should be "frozen," because nobody in their right mind should want to make those loans in a normal environment.

[And just to be 100% clear, I don't think all "activist" investors are bad. Many are truly engaged with the companies whose stock they own and try to maximize long-term value. The ones whose idea of "adding value" can be summed up as "issue debt, buy back stock and give ourselves huge 'consulting' fees for coming up with the idea" are toxic and really need to die off, along with probably 2/3 of the hedge funds out there.]

In the meantime, I'm not looking to buy a condo just yet. I've got a couple of ideas in mind, but believe there's still plenty of time.

-btc

Mish made some comments here that jibe with what Cody and I have been thinking.

All the talk by Cramer and others about the "saving" of homeowners who will now avoid foreclosure is missing the point, and is what I get from lots of "experts" on wall street -- people who have no mortgages, or at least none that they ever need to worry about, and who also don't have any clue what the cost of living is because they don't even pay their own bills -- about such things.

If you're one of the millions of people who took out an interest only option ARM with a low 1-2% "teaser" rate that is resetting to a market rate, it doesn't matter much whether it resets to 6% or 6.5%. You're still going to see a 3x or greater increase in your payment, and if you're one of the people who took them out -- people who mostly are not employed as Wall Street "experts" -- odds are you don't have the cash to handle that, no matter how much the fed cuts. The only thing that can save you is higher prices than you paid, and in many places those are now out of the question.

Even people with regular ARMs resetting are going to find themselves in trouble. And if you're on one of the coasts where you pretty much need a jumbo loan to buy anything, then none of this matters because the rates on those loans, even if they come down, will still be a lot higher than they were a year ago.

This cut, ultimately had nothing to do with homeowners and everything to do with saving banks and hedge funds. Remember that the fed is ultimately run by and for the bankers. Which is part of the reason it should be abolished. Our global capital markets are larger than any economy and more than capable of providing all the financing the world needs without artificial government money creation.

-btc

Wow, with the mom move this past month, I've been offline for some time. Back for the Fed insanity though.

I entered the day pretty flat, agreeing with my friend Cody that nobody really had any advantage going into this, so there was no point in trying to game it. Glad I did. My own view of the economy, through the prism of watching the local LA condo market and food prices, probably would have had me leaning a bit shorter than normal. As it was, my few select shorts lost money, but it sure wasn't as bad as it might have been if I were short homebuilders and financials!

• In the end, Cody has things right. This is just another example of the government trying to micromanage our lives, and in the end just distorting things, punishing good behavior, and rewarding their friends. A recession would be good. Actual deflation would be even better. For all the fed/banker talk, deflation is good for the end consumer, for savers and for wage earners. It feels awful, but it's when bad debt gets written off, costs fall faster than wages and incomes, money flows away from junk and into more productive use, and the people who lose are the bankers. Inflation and interest rate cuts are the opposite: feel good, but gut the purchasing power of normal people to the benefit of lenders and (ultimately) government. Down with central banks!
• Cramer has really been a charlatan through this whole episode. I've found him much more tolerable lately than I did in the past, but today I had to shut off the TV. Last week, when he commented on what might happen, he laid out the case for anything the fed doing being bad, suggesting that a 50bps cut could only be justified if the fed saw some real problems, which should be a concern for investors. Today, with the market up over 300 points (thus proving his trading game plan wrong), he's talking like the 50bps cut was a brilliant move, and dismissing all the concerns he expressed himself last week. I can deal with a guy who gets it wrong. I hate guys who get it wrong and act like they were right all along.
• Would not be surprised if we got a pullback, and would use it to add a few global-growth names, but would not do more. Also would not be surprised at no pullback, in which case I'm unlikely to do very much of anything.

Good to be back

-btc