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Strategies & Market Trends : Tech Stock Options

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To: James Strauss who wrote (56728)	10/30/1998 12:04:00 PM
From: Stephen	of 58727

Jim, this is a balancing act. Liquidity is better than it was....and some people say not as bad was made out - and fairly specific...... besides it can return to the market in an eyeblink. If AG overplays his hand, wage inflation etc will become an issue. He also continues to add liquidity to the market and this seems to be an ongoing method to keep things afloat. As for the reason for the rate cut - I believe that it was because he wanted to avoid an imminent disaster to one or more of the financial institutions and the systemic effect that would have had on the macro-economic system. If that has now been averted, there is no reason to cut rates further, especially as he needs to do a balancing act with the $ exchange rate, and the foreign investment in the US market. Course, he doesn't want the markets to tank - but he doesn't want to fuel irrational exuberance either. How big a fall would not making a tax rate cut promote ??. How much would it fuel a rally - if its built into the market and he feels he has to make the cut because its expected ... then we are all in trouble ...... Anyway ... we'll see ... Good luck all

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