By Herb W. Morgan, III, Efficient Market Advisors

This morning the Fed made a very much expected, unexpected cut to the Federal Funds Rate of .50%. We attribute yesterday’s massive rally to the concensus this would happen, and today’s selloff to the realization that monetary policy is not the solution to the now certain negative impact of the coronavirus on the global economy. To be sure, risk asset values had appreciated in an unsustainable way reaching an all-time-high on Februray 19th. The Fed cut this morning because it had to listen to the yield curve. Fed funds futures continue to indicate that another cut this month is more likely than not. Continue Reading Here