.50 percent rate cut, what did we get?

Inquiring minds might be wondering what's changed since the 50 basis point cut by the Fed.

List of What's Changed

• Perception has changed.
• Any perception of the Fed as being concerned about inflation went out the window.
• Any perception of the Fed as being concerned about the dollar went out the window.
• Bulls are the happiest they have been in months.
• The stock market is higher.
• Gold is higher.
• Oil is higher.
• The Prime Rate dropped 50 basis points.

That's really about it. But what was the reason for the panic cut? Asset backed securities received no bids, the commercial paper market was in the dumps, and this all started with a mess in subprime mortgages that spread to mortgages in general, and foreclosures are now soaring. The jobs market is also very weak with huge mass layoffs by financial organizations.

List of What Hasn't Changed

• Mortgage Rates. (Actually mortgage rates rose since last week as the chart below shows).
• Auto Loan Rates. Nearly identical to last week.
• Home Equity Loan Rates. Nearly identical to last week.
• The outlook for jobs. (If anything the outlook is weaker judging from the Fed's panic.)
• Credit Card Interest Rates.
• The foreclosures outlook did not change. It is still bleak.

So did that 50 basis point cut help anyone? Yes, it helped (temporarily) those in the stock market. It helped (again temporarily) bail out Bernanke's banking buddies by providing more short term liquidity. It helped those short the dollar and long gold.

But did it do anything to address cash strapped consumers in way over their heads in houses they cannot afford? The answer to that is no.