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To: Mephisto who wrote (23336)	8/30/1999 3:22:00 PM
From: Mephisto	Respond to of 24894

This week, reports on manufacturing activity and unemployment are expected to offer the latest signs of whether the nation's continued economic growth is being threatened by inflation. Analysts say signs of inflation could convince investors that the Federal Reserve will raise interest rates for a third time this year. The Fed raised rates in late June and last Tuesday, and stocks rose on chairman Alan Greenspan's hint that the two rate increases might be enough to keep inflation at bay. But on Friday, the Dow dropped 108 points after Greenspan suggested at a Fed conference that the central bank should consider the effects of the bull market while setting monetary policy. Greenspan also deemed the market's long rise ''inexplicable.'' ''People have good reason to be concerned and cautious,'' said William Meehan, chief market analyst at Cantor Fitzgerald. ''If anyone had any doubts that Mr. Greenspan is still concerned about inflation, he put them to rest on Friday.'' Analysts say Greenspan has been distressed by the market's tendency to rise following interest rate increases. Generally, higher rates are bad for stocks because they can cut into corporate profits and make other investment vehicles more attractive.