Three key points from my pal Dan Clifton -- he's director of policy research over at Strategas Research Partners.
1) The credit crunch is continuing, with 3-month T-Bill rates down an additional -100 basis points today, the Fed could cut the funds rate any time now.
2) There is a global panic / flight to quality. This panic has created a run on Treasury Bills, which is getting out of hand. The commercial paper market is not working, despite Friday’s intervention.
3) There is no economic data of significance to change this view over the next several days. It seems unlikely that the Fed will make it to the September meeting without cutting rates.
Also, another prominent former Reagan Federal Reserve governor (besides my friend Wayne Angell) weighed in with an email earlier suggesting that a 4.5 percent fed funds rate should be the next target.