Housing loan defaults, stock market and mamba2 tragedy

Housing loan defaults are behind the volatile stock markets. I drew out a very simplistic diagram on the effects of discount rate on the stock market. This doesn't directly answer the question on why housing loan defaults affect stocks...but its has a similar effect. Defaults affect interest rates banks give to enterprises to make up for the financial loss of defaults PLUS huge market panic (which is the real culprit more than anything). Stock price is dependent on discounted future cash flows...future means uncertainty....panic and uncertainty don't go well together.

Okie now, just to make sure we understand the topic better..three questions to think about...

If federal rates are cut how does it affect the following?

1. Dow Jones; up or down?
2. Gold price; up or down? (assume oil trade, market demand and supply, etc. is consistent)
3. US currency exchange rate stronger or weaker?


BTW, a kid driving a chevy truck backed into my stationary mamba 2. My heart weeps.... :((((