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Politics : Ask Michael Burke

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To: BGR who wrote (71997)	12/17/1999 12:08:00 PM
From: benwood	Read Replies (3) of 132070

BGR, what AG did was like a company issuing a positive surprise PR 10 minutes before the close; or warning 10 minutes before the close. Whatever -- the big guy wins and the little guy loses. Issuing the rate decrease a few minutes before the market closes does not change the monetary fundamentals one iota (OK, maybe 1), but it totally altered the outcome of the options expirations. And as Skeeter pointed out, that was the intention. Waiting 45 minutes (or whatever it would take to wait until the market closed) would have resulted in the same monetary policy and the same interest rates, but it wouldn't have achieved what I believed were two goals: altering the "outcome" of options that day; and serving notice that for the rest of his chairmanship, AG would be the guardian angel of Wall Street. AG making his announcement 2 minutes earlier would have produced the exact same result as he got. Don't you find it odd that notices of interest rate HIKES can be telegraphed weeks and even months in advance (no raise in interest rates, but a bias towards doing so next month), yet his intention of saving the markets via an abrupt interest rate cut (or whatever he is able to do at the time) is now known and I believe counted on by Wall Street.

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