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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 176.740.0%10:41 AM EST

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To: Robin Plunder who wrote (116066)3/27/2002 1:43:13 PM
From: Jim Willie CB  Read Replies (1) of 152472
 
got your 1929 facts a little confused
in 1929 the Federal Reserve tightened heavily
they responded to other New Economy based on automobiles
they didnt ease on rates for 4 years !!!

in 1999 Fed tightened heavily
they kept the tight rates for way too long
evidence was an inverted yield curve all autumn 2000 long
the Fed should have begun to ease in Oct2000
they didnt
in January they panicked with rapid cuts

you mislabel the current situation
BUSINESS CYCLE recession is characterized by higher price inflation, higher interest rates, and shortages of goods

STRUCTURAL CYCLE recession is characterized by price deflation, falling interest rates, excess debts (public and private), excess capital equipment, excess goods

this is a STRUCTURAL correction, a part of a larger cycle which contains several business cycle corrections within it

that is why lower rates are not prompting the stock market indexes higher
that is why the recovery didnt happen in 2ndHalf 2001
lower rates only encourage

now instead, we will have a weak recovery, followed by a sharp and long recession

/ jim
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