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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club

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To: Ian@SI who wrote (5391)	5/26/1999 10:55:00 PM
From: MrGreenJeans	Read Replies (4) of 15132

Federal Reserve Thoughts In I believe 1994, if memory serves me well, Alan Greenspan warned the markets in congressional testimony? that there was a chance rates would rise. As I remember most, in this case, bond traders believed nary a word of it. After the first increase the spin was that the job was done and there would be no more increases in the foreseeable future. Greenspan proceeded to raise the rates more than once that year and one of the greatest crashes of all time occurred in the bond market far surpassing the 1987 stock market crash. There is a real possibility in the present time frame that Greenspan has given investors his warning and will take back one, two, or possibly three of the rate cuts he gave investors last fall especially if the data indicates inflation in the pipeline. My guess is that the PPI and CPI indicates little if any inflation in June. So what is the possibility Greenspan raises rates to dampen equity speculation? To prevent a stock market bubble?? To slow down the wealth effect??? That in my mind is the wild card tonight.

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