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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Mike M2 who wrote (66965)	8/29/1999 6:50:00 PM
From: Merritt	Respond to of 132070

Mike/Will, or whoever<g>: <<To date he has done everything possible to perpetuate the bubble so I am reluctant to read to much into his tough talk.>> Right on. The same day he made his tough-talking speech, he added liquidity. If he truly wanted to deflate the bubble, all he has to do is quit pumping it up. Interest rate hikes will work in time, but a tight monetary policy would work even quicker. I suspect that he's worried about a 30%-40% sudden decline in the markets, as that would put the entire banking system at risk of a melt-down because of their massive derivatives exposure...with disastrous results for the U.S. and world economies. That's a very real worry, IMHO, but instead of addressing it in a quiet, meaningful way (i.e. reducing the supply of new money), he's apparently still trying to jaw-bone the bubble down. Seems to me to be an egoistic approach, but worse, as yet it's been mostly ineffective.