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OK, we know it's fruitless to play the "what of" game, and we're constantly telling traders to avoid it when it comes to their past trades and future results. However, sometimes it can be fun and actually educational. So we decided to write the article you'd read on any major news site if the Fed shocked us all and raised the Federal Funds Rate a quarter point. Add your own paragraphs too in the comments below!
See charts, analysis, videos and data by clicking on the flags "The Federal Open Market Committee shocked the financial world today as it defied analysts, economists and investors by adding a quarter point raise to the Federal Funds Rate, the rate at which banks lend their federal reserve balances to each other.
The move is widely believed to be an effort to slow the looming threat of inflation. Traders on Wall Street anticipate that the move will not only lead to higher costs of capital within struggling industries but could lead to a round of stagflation. This ends the Fed's 0 interest rate policy and could signal future increases in subsequent meetings this year.
The move dealt a death-blow to the major currencies against the US dollar, as the EUR/USD plummeted to 1.35. Oil prices were likewise hit hard as the price of crude fell to $50 a barrel and is likely to continue its slide in coming weeks.
The plunge of US stocks triggered a halt in trading as pre-defined measures were hit which prevent the market from crashing. Investors and spokespeople at all the major institutions expressed outrage and concern that Ben Bernanke and his Committee were operating completely maverick and were likely to cause global economic collapse.
Even worse was the collapse of 12 major deposit banking institutions which folded when they had runs on their deposits as individuals pulled their dollars from the bank and planned to put them under matresses and in secret chests.
On CNBC, Jim Cramer was so irate and animated that he literally lost 45 pounds during a 30 minute broadcast. Stay tuned for more tomorrow."
OK, we got a little too cheeky at the end, but it's kind of fun to noodle on. Your thoughts?
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