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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: ldo79 who wrote (5427)	1/18/2004 1:17:00 PM
From: mishedlo	Read Replies (1) of 110194

Canada-Laying seige for a bank rate cut biz.yahoo.com The group of economists, a virtual Who's Who in the august field, had a "colorful" airing of their views, but in the end a majority overwhelmed avid dissent and called on the Bank of Canada to finally ease up on interest rates. It was the first time that the 12-member Monetary Policy Council, set up by the C.D. Howe Institute last September, has come out in favor of a cut. They advised the bank to drop its key rate to 2.50 percent from 2.75 percent at its setting on Tuesday. They join a growing clamor for an easing from economists and business types alike in Canada who want to see a cut to stem the robust Canadian dollar. Some believe the bank needs to cut up to 75 basis points this year to douse the flames of the roaring currency that rose more than 20 percent last year. The turning point for many was the report last week that the trade surplus for November fell to C$4.32 billion from C$5.16 billion the previous month, largely on the back of weak exports. A majority of Canada's primary bond dealers, according to a Reuters survey last week, now also expect the bank to move lower on Tuesday, which would be the first cut since September last year. "In a world where the U.S. central bank repeatedly hammers home the message that overnight rates will remain at 1 percent for the foreseeable future and a weak U.S. dollar has no ill effects on the American economy, the monetary authorities here ought to take this golden opportunity to let her rip -- gun the engines, assure that growth rebounds sharply from last year's pathetic 1.6 percent pace," wrote Cooper, who is not on the Monetary Policy Council. ================================================================= I believe this is very significant Russ - look at what I bolded. Greenspan and the falling $ is going to force every country in the world to debase their currency. It's a mad rush to zero. I will let you decide what happens when we get there. Mish

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