Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: ed who wrote (27497)	7/29/1999 11:15:00 AM
From: John F. Dowd	Respond to of 74651

ed: Right on ed! JFD

To: ed who wrote (27497)	7/29/1999 11:24:00 AM
From: DownSouth	Read Replies (2) \| Respond to of 74651

ed, have you never lived in inflationary times? Do you not recall the phenomena of spiraling inflation? Please do some studying in basic economics rather than posting some strangely naive postings, sir. It will save you some embarrassment and the rest of us some bandwidth.

To: ed who wrote (27497)	7/29/1999 1:13:00 PM
From: Gerald Walls	Read Replies (2) \| Respond to of 74651

Then what is the difference by increase the rate and let the price be inflated by itself till a level people will not buy , and then the price drops ? Just let the free market force work by itself !!!!! In the very long term that would work. In the short term it would cause extremely painful "dislocations" as the politicians and economists say. We would quite probably end up with the Japan scenario. Economic cycles don't reverse themselves on their own until they swing way too far. In order to temper the extremes the Fed manipulates interest rates. If done properly periods of expansion can be extended and periods of contractions can be shortened. An analogy would be that of an automobile engine. Money is the fuel of that engine and interest rates are the throttle. If you allow the engine to red line you may get great speed for a while until the engine blows up. Then you get to sit in the pits while the engine is repaired. On the other hand, if you throttle back on the fuel when the engine is racing too high you can keep it running a lot longer between repairs.