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Strategies & Market Trends : Heinz Blasnik- Views You Can Use

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To: GraceZ who wrote (396)4/22/2003 3:18:03 PM
From: LLCF  Read Replies (1) of 4914
 
<The Fed can only add money by adding reserves.>

<It doesn't enter the system if people aren't willing to borrow it.>

No, the fed can monitize securities, no? Or adjust non-borrowed reserves? Besides, as long as there is a 'bid and offer' [we're probably not far from 'no bid'] there is always a willing borrower... maybe the fed needs to start lowering it's offers! LOL, Borrowers aren't too interested at todays prices anymore I suppose. Me neither. Anyway... aren't you really saying that if there are no borrowers there won't be much of a 'multiplier' effect? The injection would be one time?

<Rising cash levels doesn't mean it's being created by the Fed. >

Did I say that?

< The Fed has cut permanent creation to almost zero in the last year>

What's that mean?

<It's the currency portion of the money supply which has risen sharply.>

Couldn't currency creation be pretty permanent?

DAK
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