Central Banks Cut Rates...

Was the 50 basis points rate cut by the leading central banks too little too late?

By the way, 1 basis point = 0.01%.

In fact, this action was what leading economists were suggesting as far back as 6 months ago! As a matter of fact, the recommendation was for a full 100 basis point cut. So, was the Fed's action too little and too late?

Too late, yes. The damage so far have been catastrophic. Too little? Maybe. 50 basis points isn't going to get the banks all hyped up and lending all of a sudden. But how are investors reacting to it? Well, surprisingly, I think investors are more optimistic about this action than I would like to admit. There was plenty of buying and plenty of selling-into-the-rally today ending the market slightly lower. It is the buying that I find interesting. Today's buying action is clear sign that the bulls are back significantly and could cause some problem for the bears. This is the time to be very careful about wanting to be newly bearish.