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Strategies & Market Trends : The Amateur Traders Corner

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To: Tom Hua who wrote (14374)10/1/2001 1:18:30 AM
From: RockyBalboa  Read Replies (1) of 19633
 
I agree but it is hard to conceive that the feds use all their ammo. Other thing is, the economy is really so bad, much worse than anyone believes and we will see low rates over the next few years.

A deflationary scenario would keep the money out of the market even in a low rate environment. Looks like that's what is feared. Japan comes to my mind. 0% and some sort of liquidity trap.

I agree that a long term tax stimulus only endangers the budged and will drive long term interest rates up. That would be another means to move funds.

The only problem is that monetary policy can not cure nonmonetary problems. Problems which result from saturation, simply put.
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