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Strategies & Market Trends : MDA - Market Direction Analysis

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To: westes who wrote (51853)	5/23/2000 11:12:00 PM
From: drsvelte	Read Replies (1) of 99985

"Most people don't realize that in 1929 the Fed acted immediately after the crash to lower interest rates, first from 6% to 5%, then 4.5%, then 4%, then 3.5%. THOSE INTEREST RATE DECREASES DID NOTHING TO HALT THE SLIDE INTO THE ABYSS. The fact is that interest rates are notoriously unreliable as a way to stop recessions and depressions. Interest rates work very well, though, as a way to stop growth" My understanding of monetary policy in the early 1930's is almost opposite of what you describe. Rather interest rates were increased, not decreased, resulting further contraction. Here's a link.... infoseek.go.com Perhaps you can provide a source of information on the reduction in rates from 6% to 3.5%.

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