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Strategies & Market Trends : The Amateur Traders Corner

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To: DebtBomb who wrote (15736)	11/6/2001 9:18:50 PM
From: Tom Hua	Read Replies (2) of 19633

Dale, the Fed has run out of bullets. The effective Fed fund rate is about -1% when adjusted for inflation. The Fed has done more than they should, IMO, to stimulate the supply side but it hasn't been working because of lack of demand. Business investment and production are driven by demand, not supply. This is where the stimulus package may help but I suspect it can go as far as narrowing the U-shape recovery, by no means is it sufficient to yield a V. More and more I see a parallel with Japan. Zero interest rate, plenty of liquidity, but there is no demand. Regards, Tom

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