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Non-Tech : General Electric (GE)
GE 298.45+0.6%Nov 28 9:30 AM EST
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To: Captain Jack who wrote (1784)3/16/2001 7:53:08 AM
From: Arthur Tang  Read Replies (1) of 3256
 
Feds does foolish things just to fight for their independence. Japanese central bank went from 0.15% to 0.25% just because Prime minister Mori opposed it. Their economy has tanked since then too.

First drop of interest rate in January was more than 0.5%. IMF people think that Greenspan can drop all the way to 0.15% to stimulate the economy. (GE Capital should borrow more money in Japan.) Then we will make the same mistake as Japan. They can never raise the cost of money without suffering economical disasters. We had standardized at 5% overnight discount rate and can move up and down to compensate the economy by satisfying servomechanism equations(mathematics) plotted against time.

We(central planning) think the interest rate can do more than tax cut. Tax cut this year is only going to be 0.5% of proposed surplus(senate disclosure last night on the PBS news). Just look at the business Intel lost so far; and you know tax cut is not going to be a stimulus. Our government better save it for a rainy day.

On the other hand, money supply M2 increased by $25+ billion last week. Consumers are holding back because there are no new and better goods and services to buy. It proves savings(idle money whatever the size) are bad for the economy.

My accessment on the economy is still we need more planned obsolescence(apparel, radio, TV and HiFi electronics) and quick about it too.
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