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Politics : Ask Michael Burke
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To: Mike McFarland who wrote (75296)2/7/2000 2:49:00 PM
From: IceShark  Read Replies (3) of 132070
 
Mike, I think you may be correct until a fundamental emotional shift occurs.

Most spending is consumer driven, towards 70 % as I recall. The wealth effect runs rampant and credit is pretty cheap. I have credit card offers on cards that used to charge 19%, giving me checks to pay off other balances for a lifetime fixed rate of 6.9%, unsecured. I dug into these a bit and found out I really don't have to pay off another credit card balance .... I can actually have them put it in my checking account! Do whatever I want with it. One even told me to take it and invest in the stock market! -g-

With NASDUNG going up 2% a day, I can pay the year's interest load off in 3 1/2 days and it is gravy from there on out. -g- Heck, it is still wise to keep 19% outstanding balances since that only takes 10 days to pay off. Same applies to mortgages or home equity loans. So the consumer will not be fazed by BubbleBoy notching up by a few quarter points. -ng-

Same conclusion applies to corps., since no one cares or links what they earn to the stock price, especially with the analysts' earnings expectation scam. And cheap equity capital is there for the taking. Just watch AMZN as the poster child when it floats the new convertible which will likely come in over a billion with over subscription, no doubt.

It is a mess that BubbleBoy has lost control of and I have no clue when the perpetual motion machine seizes a bearing, but it ain't goin' to be because he is raising rates. -ng-
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