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Technology Stocks : Intel Corporation (INTC)
INTC 36.04+4.5%11:56 AM EST

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To: willcousa who wrote (129859)3/13/2001 5:31:28 PM
From: GVTucker  Read Replies (1) of 186894
 
willcousa, RE: Milton Friedman would let the market set rates. I would love to see that tried.

We are not as far away from that as you think.

Most small business loans are based upon the lesser of a spread against prime (Fed driven) or a spread against LIBOR (market driven).

Larger businesses have been able to borrow based upon market rates for some time now.

Market based rates are even creeping into the mortgage world.

Banks don't borrow at the discount window at all any more.

The only place that I can think of that is still solely driven by Fed-set rates is probably the capital markets. Individuals still borrow and lend to buy stocks based upon a spread against Fed funds.
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