It seemed that after the Fed shocked the market with a 50 basis point rate cut, there was panic on Wall Street. It appeared the market took the surprise cut as an act of desperation and a sign that perhaps things are a lot worse in the economy than what had already priced in. The market was also freaking out because it was Super Tuesday, or Thursday, as Joe Biden might say, and feared that the U.S. would set the stage for having a socialist lead a major U.S. national party.

Yet really, was all that fear justified? Joe Biden put on am impressive show as traditional democrats rallied around him. Bernie Sanders did win the coveted left coast vote by winning California, yet he is still doing very poorly with black and Latino voters and lost the South, so there is a sense that this may be the peak of his presidential bid. So with the odds favoring a somewhat more moderate Joe Biden as the nominee, the market can now focus on the Fed rate cut.

No, the Fed cut can’t cure the coronavirus. The Fed rate cut cannot fix broken supply chains. It can’t make people work from home or cancel meetings. Yet what it can do is provide liquidity until the coronavirus fears start to decrease. While it is vital to take the threat on the coronavirus seriously, we are probably just weeks away from a point where the frenzy should subside.

Now with the FED cutting rates and the possibility that they will again, will this at some point inflate asset prices. I know the market did not react like that right away. Part of that was the timing of the announcement. The market does not like surprises. I think if the Fed waited until their March meeting to announce the cut, it would have had less of a negative impact.

But by moving yesterday, it raised fears that this was bad and people got scared. Yet do not get too scared of the initial reaction. While the Fed announcement may have been ill-timed at the day, the Fed will have the final say.

Just remember when the Fed first announced quantitative easing the market initially took it as a negative. Yet, in reality, they put in a floor on commodities and stocks. It took a while for the market to believe that Mario Draghi, the former ECB bank head, would do whatever it would take to save the Eurozone. Is the eurozone still there? Is it not? I think it is. Done. Now worry about people who say the Fed does not have enough bullets because we have learned that at the end of the day, the Fed has plenty of ink. The day after QE, I wrote, “I fought the Fed, and the Fed won. They needed money, so they printed some.” Now Reuters is reporting that, “The European Central Bank’s rate-setting Governing Council held a telephone conference call late on Tuesday to assess the impact of the coronavirus outbreak but policy action was not on the agenda, two sources told Reuters. The meeting, held after the Federal Reserve’s rate cut, discussed operational and business continuity issues and there was no debate on whether the ECB should enact policy measures, like its U.S. counterpart, the sources said. An ECB spokesman declined to comment. The bank’s next scheduled meeting is on March 12.

So ultimately, the Fed will inflate asset price because, despite the market reaction, you won’t be able to fight the Fed along with all of the central banks across the globe. Yes, volatility is high, and we may get some fear plays. But the Fed, with the power to inflate asset prices, cannot and will not be denied.

That also means oil. The crude oil market is also getting support by growing expectations that OPEC plus Russia will push through a production cut of a million or more barrels of oil a day. Reports say that, “Russia and Saudi oil ministers said to hold bilateral meetings ahead of OPEC JMMC meeting to iron out the final numbers, and it is expected that Russia, as usual, will go along. Maybe 1.5?? Stay tuned.

This would come at a time where OPEC production is already way down due to Libya. As Reuters reported yesterday that, “OPEC oil production is at the lowest level since 2009 pumping 27.84 million barrels per day (bpd) last month, according to the survey, down 510,000 bpd from January’s figure.”

Yet while the OPEC meeting goes on, the press can’t go into the OPEC building on coronavirus concerns. Another reminder that we are not in an ordinary world right now. We are living in a coronavirus world.

Also, if it matters, weekly supply data from the American Petroleum Institute (API) was supportive. MarketWatch reported that, “API as crude supplies rose by 1.7 million barrels for the week ended Feb. 28, according to sources. The API data also reportedly showed gasoline stockpiles fell by 3.9 million barrels, while distillate inventories declined by 1.7 million barrels. Inventory data from the Energy Information Administration will be released Wednesday. The EIA data are expected to show crude inventories rose by 3.5 million barrels last week, according to analysts polled by S&P Global Platts. They also forecast supply declines of 2.8 million barrels for gasoline and 2.4 million barrels for distillates.