Suggestion From One Clown To Another.Heh Heh Heh.........
Dr. Mr. Greenspan :
It is my Strong opinion that Your FED should NOT...repeat..
N-O-T-!!
Lower interest rates any further...regardless of what Wall Mart..er..Street...keeps whining about.Here's why......
1. As long as borrowers think money will continue to get cheaper, they will hold off on their plans to borrow.This is the deflationary effect seen in most, if not all,cases where the consumer ( of ANY nature )waits till the bottom is considered in place.YOU are the one calling the bottom Mr. Greenspan, not the market or the economy.Kapish?
2. People on fixed incomes are suffering from this low interest rate environment to the degree that THEIR spending power is all but dried up.They are in survival mode in many cases and should not be the ones who bare the brunt of an economic adjustment , brought on by few of those who are most seriously affected.Do not continue to take from the poor to give to the rich...its UN-Robin Hood like, eh?
3. The US$ is holding extremely well under these lower rates due to economic factors not necessarily indigenous to the USA, and more specifically tenant towards a global phenomena known as " flight to quality "... Or " flight to that which you know ".There is no indication lower rates are having an affect on the US$ to date, why should they in the future?The US$ demise will not come from lack of interest/return,but lack of confidence.
4. A further lowering of rates might just be the last injection of liquidity that causes the overshoot going forward.Can you say " Overshoot "? I knew you could.
5. And last but not least there is this : The energy crises ( for sake of a better term ).Energy supply/demand is likely to level off here some time soon, which will in itself shift some much needed capital towards consumer products and away from that burden for the USA called energy.The power generation build-out is in full swing and exploration that brings new supply to market is in a mature state already( except for Alaska and Canada’s North).OPEC will NOT..repeat..NOT pull back production in September.Many reasons for this that I'm sure Mr. Bush can explain to you, if you choose to confer with him " Down On Da Ranch ".Heh Heh Heh.....
Yes Mr.G.....the time has come to call the bottom in the economy by YOUR leadership.Time to stop looking in the rear view mirror for what lies in front of you.It would be a welcome change.Let the economy fly on its own path to sustainable growth now.You have done enough.
Best Regards,
KCFOS |
