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Pastimes : All Clowns Must Be Destroyed

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To: pater tenebrarum who wrote (18397)3/16/2000 5:46:00 PM
From: KyrosL  Read Replies (2) of 42523
 
Heinz, I agree with what you say. The Fed is setting short term interest rates and then accommodates all the credit demand at those rates -- if the rates rise above the target, they inject money to bring them back on target. This has been fed policy for some years now, and seems to have worked fine. Since credit demand is so robust at these rates, and the economy shows no signs of a slowdown, next week they will raise interest rates by .5, IMO, unless the stock market behaves. This may moderate the credit demand. If not, they will raise again and again until there are signs of a slowdown.
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