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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED

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To: 2sigma who wrote (32238)3/2/2001 10:40:07 AM
From: Jim Willie CB  Read Replies (1) of 65232
 
in recent weeks the Fed has been desperately adding to money supply with FOMC purchases in the Treasury credit market

the last thing they want is the horrible scenario to unfold:

illiquidity hits credit market, driving up rates from lack of buyers, despite slowing of the economy

that is the recipe for an economic depression

that happened in 1930

the Fed and GreenDumb have their work cut out
they created a monster, unleashed it to fight non-existent inflation (except in energy pockets which will subside), citing unsustainable growth (that would have tapered on its own after Y2K), and now must fight hard to kill their own monster (which they improperly identify as "natural")

/ jim
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