The Federal Reserve's overnight rate that was reduced to 2.25% just yesterday, and sent the Dow flying 420 points into posititve territory, gave a good chunk back today. The DJIA falling 293 points to 12,099.66 means that Bernanke's magic bullets were a very short-term fix to what ails us.

Not even some positive earnings reports and falling oil prices could sustain the markets run-up. The following stories were posted by my colleagues:

• Morgan Stanley joins Goldman Sachs in helping quell bank panic
• General Mills (GIS) quarterly profit surges 61% on strong sales
• Oil extends its pullback following today's inventory report

This has to be very discouraging to the folks in Washington DC, and on Wall Street. There is no telling what tomorrow will bring but you can only cut so far before there is nothing left to cut, and you also have a dollar that won't buy much.

But one day is meaningless in the grand scheme of things, and reduced interest rates and increased stability in the financial sector has historically given way to a stronger stock market six months out. After all, that's when the presidential elections will take place and those are the high stakes games to keep your eyes on. For that reason, I expect still another rate reduction before too long so that there is time for it to take effect.

Sheldon Liber is the CEO of a small private investment company and the design and research principal for an architecture and planning firm. He writes Chasing Value and Serious Money columns.

Dow down 293: Bernanke's magic bullet did not last 24 hours originally appeared on BloggingStocks on Wed, 19 Mar 2008 17:22:00 EST. Please see our terms for use of feeds.

In about an hour Ben Bernanke will be opening the envelope to let Wall Street know who the winner is; banks, hedge funds and mortgage holders or all of us energy consumers already facing all-time high prices. Perhaps with the eyes of the world upon him, Bernanke will do a Ryan Seacrest and break to commercial. After all, how many people can command this much attention? Even president Bush gets poor ratings these days; who cares what he says any more?

Don't they say follow the money? Big Ben is not a clock tower in London any more, or a quarterback for the Pittsburgh Steelers. Big Ben is the moniker for the current Federal Reserve Chairman, and since it's all about money, you can't get any bigger than that. Expect to see him touted as the latest sex symbol on the cover of everything, as Kissinger was when he was getting so much attention with his shuttle diplomacy ... I never could figure it as a kid, but I have learned power is intoxicating and Big Ben has it.

So what is going to happen if Bernanke actually does break to commercial after saying to his world-wide audience to simply come back in a couple of months -- same time, same place. Perhaps the market will drop several hundred points and many people's hopes will be dashed. On the other hand, after the tears dry up, the investment world and mortgage holders will have to refocus on what they can do for themselves without government help. All those Wall Street guys who shun government interference all the time are now praying for it - the ultimate hypocrisy!

To find potential opportunities and verify my track record read Chasing Value or Serious Money.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He is on the advisory board of Internet start-up CircleBuilder.com.

And if there's no cut, Bernanke may break to a commercial originally appeared on BloggingStocks on Tue, 18 Sep 2007 13:02:00 EST. Please see our terms for use of feeds.

Strong GDP growth is bad news for Citigroup (C) originally appeared on BloggingStocks on Fri, 31 Aug 2007 10:39:00 EST. Please see our terms for use of feeds.

In general I am not in favor of bailing anyone out of their mistakes in judgment. This goes double for investment banks and hedge funds. If investors in these funds want relief they can go to court in those cases where shenanigans or negligence occurred.

I was going to write a post suggesting that Chairman Bernanke do nothing for the next five years and leave the 5.25% Fed Rate alone. It seems to me that stability and consistency in the market are very important and I do not believe that Wall Street should go crying to uncle Ben when they blunder. I have reassessed this position and now believe a 0.25% rate cut would at least reassure the markets that the Federal Reserve is not in hibernation and is paying attention to current events. While the price of a bottle of milk has gone up and so have many other staples. Fuel prices, and home prices have come down as have most modern appliances. Computing power and productivity continue to rocket upward.

Based on my lowly observations inflation is at least temporarily holding steady so while we might debate the subject, there is no debate about the credit crunch. Having come to this conclusion, The Fed should still wait until their next meeting to take action and not before, because they need to show some discipline in an environment where all of our other financial institutions have lost their minds and a lot of credibility Moody's & S&P credibility called into question - my rating FFF.

Those of you who are new to BloggingStocks can check out my other stories and read Chasing Value or Serious Money to find more potential opportunities and verify my track record as well -- INCLUDING ANY BAD CALLS.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm.

Time for the Federal Reserve to step up to the plate and take a swing! originally appeared on BloggingStocks on Thu, 16 Aug 2007 08:45:00 EST. Please see our terms for use of feeds.