McTeer Calls It

From the Washington Post:

"The Federal Reserve and a consortium of European central banks today announced a half apercentage point reduction in a key interest rate, a coordinated effort to stave off an economic slump even as they continue struggling to tackle a crisis in global financial markets. "

From the NY Times:

"Central banks around the world cut short-term interest rates by up to half a percent on Wednesday after investors across Asia and Europe unleashed waves of sell orders onto already depressed stock exchanges."

It seems like they listened to Bob McTeer, and not William Gross on the amount of the cut.

McTeer On A Rate Cut

Bob McTeer comes out for a rate cut, which is a change in his thinking:

"However, given the recent worsening in the credit freeze and its spread to Europe, I have changed my mind. The European Central Bank has been in denial, in my opinion, even given its single inflation mandate. ECB easing is overdue and a coordinated rate cut with the Fed, the Bank of England, the Bank of Canada and perhaps others participating would likely have a major impact, albeit primarily psychological.

If the Fed initiates a coordinated rate cut of 50 basis points, it will give the ECB cover to do what it should have done already. It would also give the Fed's cut more bang for the buck. After all, given the way things are going in the markets, what do we have to lose?"

Add McTeer and Gross, and you've got two intelligent people calling for a cut, although they seem to differ on the amount.