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To: Gottfried who wrote (1100)	8/10/1997 12:59:00 PM
From: Teri Skogerboe	of 1894

GM, One more thing about the economy in general. Even though it seems very strange to me, we may need to be worrying about deflation more than inflation right now. Because....Producer prices have fallen for six straight months, a record, and are now falling at ~ 3% annual rate. So, it seems to me, Alan G. will not tighten interest rates in the near future. There is just no inflation! You know for as long as I can remember, we've only worried about inflation. This deflation idea is so different, I do not understand the repercussions. Anyway, I'm betting he "takes no action" on interest rates at least for the next meeting. Any thoughts about this? Teri

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