First up, The Daily Capitalist:
A blast from the past, with the S&P around yesterday’s closing level of 1200:
Today, the Bank of Canada, the Bank of England, the European Central Bank (ECB), the Federal Reserve, the Bank of Japan, and the Swiss National Bank are announcing coordinated measures designed to address the continued elevated pressures in U.S. dollar short-term funding markets. These measures, together with other actions taken in the last few days by inpidual central banks, are designed to improve the liquidity conditions in global financial markets. The central banks continue to work together closely and will take appropriate steps to address the ongoing presses.The index closed the day with a huge about 41 point gain – just like today. Seemed promising. The date was September 18, 2008 (just after Lehman Bros. collapsed).
There already had been this:
Today, the Bank of Canada, the Bank of England, the European Central Bank, the Federal Reserve, and the Swiss National Bank are announcing measures designed to address elevated pressures in short-term funding markets.The date: December 12, 2007. As the recession was officially beginning (though said date was not identified by NBER for about a full year).
More recently, on June 29, 2011, with the ’500′ around 1300, we saw this:
Today, the Bank of Canada, the Bank of England, the European Central Bank (ECB), the Federal Reserve, the Bank of Japan, and the Swiss National Bank are announcing coordinated measures designed to address the continued elevated pressures in U.S. dollar short-term funding markets. These measures, together with other actions taken in the last few days by inpidual central banks, are designed to improve the liquidity conditions in global financial markets. The central banks continue to work together closely and will take appropriate steps to address the ongoing pressures.The index proceeded to surge to about 1350 over the next week.
I hope my point is clear regarding today’s actions, central bank- and markets-wise.
Source for all the above quotes: Federalreserve.gov
HT: HistorySquared which has some nice charts and who had another similar post on Tuesday
From ZeroHedge:
Barclays: Market Reaction To Fed-Action "Exaggerated"
First it was Goldman, now it is Barclays lamenting what is painfully obvious: what has gone up violently, will go down doubly so, once the market realizes that what the Fed and the global central banks have done is applying a band aid to a severed artery. Naturally, the disappointment will be substantial, and while Goldman is angry that its tentacles have to be retracted for a few more weeks before it can acquire the equity of some European competitors for a buck a share, Barclays is angry because it is very likely that it, together with fellow British bank RBS, will be on the receiving end of market fury. This explains the statement by Barclays' Paul Robinson who said that the "market updraft" was "exaggerated" and "it is not easy to make a case that the magnitude of the news quite justifies the magnitude of the global market reaction, in our view." That's ok - the short covering knows best... if only for a few days, because as Robinsons says, "Market participants seem as fearful of missing a market updraft as they are of getting caught in a downdraft" - in other words we are all momos now, chasing the leader and pushing the wild market swings into swings with ever greater amplitudes, until one day absolutely nobody will be able to trade the daily gyrations created by ever more frequent central bank intervention....MORE
From Barclays:
Wednesday marked the second "risk on" day of the past three, with the updraft as manic and (dare we say it?) exaggerated as last week's downdraft arguably was. For a change, Wednesday's market tone was not set by news from Europe, which ranged from the inconclusive (the meeting of the eurozone finance ministers) to the downbeat (October labor market conditions). Instead it was set by global central banks, and by upbeat economic data from the US.
