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Strategies & Market Trends : Currencies and the Global Capital Markets

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To: Henry Volquardsen who wrote (2642)12/25/2000 12:59:28 PM
From: dean poets  Read Replies (1) of 3536
 
Could it actually be a 1-2% increase in interest rates in 2001?

There has been a lot of wealth disapeared in North America over the last 8-9 months. People's money is shrinking in the latest Nasdaq Bear. Even my grandma was buying high tech's. Less investment capital or shrinking capital usually means the goverments have to raise rates on their bonds.

Commodities prices have been rising sharply the last year, and the fed still says there's no INFLATION. Almost everybody agrees the the U.S. economy is slowing severely. If the goverment lowers rates, they could open up a case for Stag Flation.

Historically interest rates cycle up & down between 4% to 20%. Although nowadays people don't seem to think interest rates will ever rise that high again. People have this notion that the economy is different now, that it will never change. Sorry folks, history has a real tendency to repeat itself.

Dean
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