Booms, Busts, and Recoveries Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Booms, Busts, and Recoveries

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: tradermike_1999 who wrote (1447)	12/15/2000 1:14:15 PM
From: Erik T	Read Replies (1) of 74559

The investment world is standing around almost screaming for a rate cut because they have been conditioned that whenever there is a risk to their portfolios, Greenspan comes in and saves them. Most everyone I know truly believes in this. A big problem with lowering rates right now is that it would weaken the dollar. The strong dollar has been anti-inflationary and has helped support our enormous and growing account deficit. If we see a sharp move down in the dollar, while we may see some pick-up in the economy in 12 to 18 months, the risk of accelerating inflation and foreign investors fleeing our system is real. As the foreigners see BOTH falling stock prices and additional lower value of their portfolios as the dollar weakens, they may be inclined to pull their money back home. Then we will have a crisis on our hands. I bet Greenspan cuts rates by January. I think it would be the wrong move, but Greenspan has almost promised investors he would step in should things turn sour. Greenspan is about easy money and I don't see why he should change now (except for all the very good reasons he should change now). Just my thoughts, Erik

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next