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Non-Tech : Alan Greenspan- the most poweful man in the world?
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To: Polarisdriver who wrote (4)3/11/1997 1:44:00 PM
From: capitalistbeatnik   of 19
 
Since he feels equities are overvalued, why use a hammer instead of a scalpel. All he has to do is raise margin requirements...that reduces speculation without killing the real estate and export markets. This seems so obvious to me, why doesnt the Fed get it?

For equity inflation, margin requirements could be inversely linked to market PE and that would contain fallout completely. For example, if market PE is 11, then margin 50%, if 20 then 80%.
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