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Wall Street Week Ahead: Stocks May Fall Again As Fed Stays Course (LO)
Skeet, What on earth does "moral hazard" mean, here? "Is the Fed going to zigzag with the taper, based on what we already knew, that emerging markets were vulnerable to liquidity being taken out of the system in the U.S.?" said Quincy Krosby, market strategist at Prudential Financial in Newark.
"It's a moral hazard," she said, adding that regardless of when the Fed withdraws further, the expected market reaction will be roughly the same."
Is she indicating that the Fed does not want to be responsible for a correction in other markets due to the Fed's actions? If so that would worry me some. Her decisions should be what is best for the economy in the US.
That's plausible, JohnChisum..... I can't for the life of me arrive at a satisfactory explanation as to why a "moral hazard" enters here, either......... Unless the term is being used the way the hosts on CNBC were using the term, back amid the '08-'09 Crash. They were clearly using "moral hazard" to refer to an unacceptably large risk of too many people losing too much money in their portfolios. Comical use of the word, "moral."
Reply to @Crash: Dittos on your comment also. Sometimes a decision includes some pain that has to be endured before the cure takes hold. In many cases, these wishy washy decisions only prolong the agony.
It also could be that the media is reading too much into this whole thing. Bernanke said all along that they would be adjusting along the way. I would assume that the new chairperson will be staying the course Mr. Bernanke established.
Comments
What on earth does "moral hazard" mean, here?
"Is the Fed going to zigzag with the taper, based on what we already knew, that emerging markets were vulnerable to liquidity being taken out of the system in the U.S.?" said Quincy Krosby, market strategist at Prudential Financial in Newark.
"It's a moral hazard," she said, adding that regardless of when the Fed withdraws further, the expected market reaction will be roughly the same."
It also could be that the media is reading too much into this whole thing. Bernanke said all along that they would be adjusting along the way. I would assume that the new chairperson will be staying the course Mr. Bernanke established.