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Strategies & Market Trends : A.I.M Users Group Bulletin Board -- Ignore unavailable to you. Want to Upgrade?

To: LemonHead who wrote (8168)	8/12/1999 10:11:00 AM
From: JZGalt	Read Replies (1) \| Respond to of 18928

LH, There are a number of flaws in this soapbox, but I don't think it is useful to discuss at this time. Author looks like he hasn't studied history or understands the basics of how money flows effect the price of dollar vs. other currencies and how that in turn has an effect on exports. I'd say that Greenspan might raise rates one more time in August, but only because the market is forcing him to. If you look at the history of the fed in the past 12 years there are only a few times when the fed has gone against the will of the markets. The easiest I can remember is 1987, then 1998 when markets around the globe were in turmoil and liquification of the financial system calmed fears of collapse. Of course the fed also has a tendency to "take away the punchbowl" a bit early, but in the long term that isn't particularly harmful. 1/4 point rise in the rate is factored into the market now and it isn't that harmful at this point. As far as Greenspan not being reappointed, the resignation of Rubin at treasury weakened the dems credability on the fiscal side, so I doubt that in front of an election he has to fear for his job. Remember this is a politically appointed job after all. ---- Dave

To: LemonHead who wrote (8168)	8/12/1999 11:15:00 AM
From: OldAIMGuy	Read Replies (1) \| Respond to of 18928

Hi LH, It sounds like CH is taking Mr. G's activities personally. He also alludes to the stock market having a life of its own - unrelated to the general macro economy. Hmmm. In any case, making Mr. G out to be some sort of spoil sport or demon is just silly. He's a banker. He charges just like any other business - all the market can bear. He knows that to raise interest rates too high will actually cut down on borrowing and therefore cut down on his "bank's" profits. He seems to have shown the ability to follow the fine line of maximum sustainable economic growth for a long time. I don't fear Mr. G leaving, I only fear that someone less capable should replace him. Best regards, Tom