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Strategies & Market Trends : Piffer OT - And Other Assorted Nuts

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To: Jorj X Mckie who wrote (34987)5/22/2000 7:43:00 PM
From: MulhollandDrive  Read Replies (1) of 63513
 
Don't get me wrong, I think that the market needed to cool off, but I think that the fed has
overcorrected at this point.<<

I think excessive interest rate hikes can in and of themselves be inflationary. Especially in a tight labor market. I can just hear it now, "My adjustable rate mortgage has gone up almost $200, I need a raise, Boss."

I've never understood why raising interest rates helps to fight inflation. Other than to eventually put people out of business after they've tried to raise prices<gg>
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