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Strategies & Market Trends : New US Economy Policy -- Ignore unavailable to you. Want to Upgrade?

To: Arthur Tang who wrote (199)	1/8/2000 7:35:00 AM
From: Arthur Tang	Read Replies (2) \| Respond to of 435

National debt is now being reduced as we speak, due in part to the economy. The insufficient monetary policy by the Feds, had prompted many treasury bond investors to have FEDS repo their 30 year bonds at a discount. The discount is due to the increased interest rate; because Feds were asked to return to the target 5.0% overnight discount rate at the NYC window. Currently it is still 4.75%. Feds are now asked not to move further up in the immediate future. The reason is that national debt can not go below $2.4 trillion(currently reduced to $3.1 trillion from $4.6 trillion) without effecting the supply side economy. The supply side economy which is largely, treasury bonds and military spending as well as the government budget to run this country. Health care and social security are in surplus; they are also part of the supply side economy. We have build up the demand side economy based on obsolescense and replacement of goods and services in the private industry. It has removed the business cycle of the years past which was driven by government planned supply side economy. We all knew supply side economy failed. The gift of government can not be sustained without tax revenue to sustain the growth. Deficit spending almost ruined our children. Labor shortages have been balanced by computers replacing manual labor. Now after five years of requesting to fix the social security system and improve the labor supply, congress finally approved our many requests of allowing retirees to work full or part time. Social security recipients are allowed to have a job and earn $15,500 without tax penalty, this year. That will reduce the cost of government subsidy to the retirees. Mr. Greenspan's worry about labor shortages will be nil, until after over 35 million social security recipients all found work.