Fed Cut 'Well Measured Move' to Avert Recession: Snow
The Federal Reserve's decision to slash interest rates by 75 basis points on Tuesday was a bold, well measured move to avoid a sharp slowdown in the U.S. economy, John Snow, former U.S. Treasury Secretary & chairman of Cerberus Capital, told CNBC's "Squawk Box Europe."
Many market watches said the unscheduled decision smacked of panic and suggested the Federal Open Market Committee had been caught unawares by the severity of the threat facing the world’s biggest economy, but Snow sees no such signals.
"I don't think it’s anything other than well measured, well thought-out efforts to avoid the U.S. going south," Snow insisted Wednesday, adding that a planned economic rescue package from the U.S. government showed that it's "bound and determined to avoid a recession."
Recent labor market data showed a fairly dramatic pickup in unemployment, Snow pointed out when analyzing the rate cut, which when coupled with the near collapse of the real estate market could indicate significant problems.
"What we need to hold the economy strong is exports now," Snow said, citing the loss of consumption the housing crunch could bring.
Ben Bernanke and the other Fed members who voted for the easing would have closely considered the implications of slowing consumer activity when making their decision, according to Snow.
"The United States takes this responsibility to its citizens and to the rest of the world seriously and we know if we go down we tend to take a lot of people with us."