wukan wrote:slick wrote:wukan wrote:NSE 20 has finally broken sub 2K to close at 1958
In the meantime FED has gone crazy and thrown in the mother of all QEs
Its my hope CBK doesnt engage in QE shenanigans like the Fed and other developed world central banks.Anyway CBK cannot do QE even if they wanted to as the Kenya Shilling would devalue rapidly possibly collapse.I know the fall in the NSE 20 is painful but let the free markets take their course.These trillions of Fed QE and repos to bailout everyone will have devastating consequences long term as all these Fed trillions are loans payable back to the Fed with interest at taxpayers expense.Inevitably the US taxpayer will foot the bill for the trillions of bailouts and thats worse than allowing markets to fall.Anyway Western markets were at record level bubble levels built on Fed money printing,over leverage and excess risk taking and thats why their fall is much more dramatic than the Kenyan bourse.
CBK joins the party CBR lowered 8.25% to 7.25% and cash reserve ratio lowered 5.25 to 4.25% which 35.2B of additional liquidity.
At least CBKs response is measured and not ridiculously excessive.Fed lowered rates to 0%-0.25%,cash reserve ratio lowered to 0% and if thats not enough liquidity,pumped in trillions in repo and QE.Now thats going overboard and despite this massive interventions,US markets still falling.This is the problem when your markets are pumped up by debt to record bubble levels where it reaches an inflection point whereby more liquidity has diminishing returns and has little to no effect in levitating asset prices.
One cannot solve a debt problem with even more debt liquidity injections.
Contrarian Investor and Trader.Advocate of free markets,limited government interference in the economy and sound money