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Politics : Dutch Central Bank Sale Announcement Imminent?
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To: Lucretius who wrote (3161)1/21/1999 1:19:00 PM
From: Zardoz  Read Replies (1) of 81050
 
"..the stock mkt is tied to the economy."
Yes I agree with that.

"economy is directly tied to the stock mkt"
No I don't agree with that. Greenspan may agree with you, but not a true monetarist. If you look back to the 1987 correction/crash you'll see that it was due to a lack of liquidity from M2 cash flow rates. And then agains in OCT. But a correction need not cause a economic downtrun.

I really don't see the debt problems as being important. But I do suggest that the true inflation rate in the usa is around 2.3% and climbing rapidly. Liquidity is the KEY to the DOW, and the economy. Not the other way around. This is what the 30yr bonds are telling you. Inflation is not as low as you think, bias is towards raising, and the liquidity is drying up. Raise the rates, raise the US cash inflow, raise the bux. This will lower the DOW, lower the NAASDAQ, and lower the gold. Thus creating faster cash inflows...
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