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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 222.70-4.4%3:59 PM EST
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To: pater tenebrarum who wrote (123541)4/11/2001 8:44:19 PM
From: GST  Read Replies (1) of 164684
 
heinz: First of all thank you. Now you say "as a consequence, banks begin to curtail their lending and capital markets seize up, with credit spreads ballooning (already happening). this leads to an (involuntary) contraction in the money supply (we're not there yet - the money supply is currently still expanding at astonishing, banana republic like rates), and falling prices.
the falling prices then contribute to the above vicious spiral by further constricting consumer demand, as buying decisions are postponed in the expectation of lower prices in the future."

First, why do you think the Fed has been somewhat slow in cutting rates -- or perhaps you do not agree with that statement -- while increasing money-supply to such a large degree? Second, why do you think the dollar is holding up so well -- and (if you don't mind) do you think the dollar can hold up through this whole process (assuming we are talking about a few years for the working-out of the bubble)? TIA
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