...via Steven Beckner:
"First, while the Fed does not want a downturn, it doesn't want booming
growth fueled by overly exuberant markets either. Second, the repricing
of risk does not come as a total surprise to the Fed. Third, it is not
the Fed's job, nor its inclination, to bail out firms like Bear Stearns
or Countrywide that have made bad bets. Fourth, as its policy reversal
in August 1998 showed, the Fed is prepared to act aggressively to ease
credit when it perceives a liquidity crisis threatens financial and
economic stability. But fifth, there is a high hurdle for such action,
and it is doubtful whether that threshold has been reached or even
approached as yet."
So much for the Greenspan put.