I guess I should mention the Bank of Canada rate cut...

From the Bank of Canada: Bank of Canada lowers overnight rate target by 1/2 percentage point to 3 per cent. Key excerpt:

Growth in the global economy has weakened, reflecting the effects of a sharp slowdown in the U.S. economy and ongoing dislocations in global financial markets. Growth in the Canadian economy has also moderated as buoyant growth in domestic demand, supported by high employment levels and improved terms of trade, has been substantially offset by the fall in net exports. While both total and core CPI inflation were running at about 1.5 per cent at the end of the first quarter, the underlying trend of inflation is judged to be about 2 per cent, consistent with an economy that was operating just above its production capacity.

It seems everyone is starting to freak out about the future of the U.S. economy. I see no reason to believe that the BoC and Fed actions are nothing but overkill and are more likely to cause more problems (hello asset bubble!) than they are likely to solve. But I guess I am an optimist by nature.

I was hoping the Bank of Canada would act more conservatively. I wasn't alone - recently Stephen Gordon said the following:

I will not be overly distressed by a 25 bps cut. But if the Bank of Canada lowers its target for the overnight rate by 50 bps on Tuesday, it will be time to start talking about a 'Carney put'. And it will also be time for someone to make it clear to the Governor of the Bank of Canada that the instincts learned at an investment bank will not serve him well in his new job.

I've said it before and I'll say it again - 2008 is begining to feel eerily similar to the 1970s.