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To: GVTucker who wrote (97392)	1/24/2000 5:01:00 PM
From: John F. Dowd	Respond to of 186894

GVT: The Fed didn't ask for any of my margin back today. What are you saying because they are doing some repos. that the gov't. has siphoned $ from the market makers because they are attracted by the short term rates. I don't think so. Who is going to leave the tech stocks for 6.6%. You are offering an answer ex post facto and hoping that there is some linkage. Dos anyone have a real idea of what is going on? Craemer claims it is the INDX put sellers who precipitate this thing but could it be that powerful? Yikes this is madness. JFD

To: GVTucker who wrote (97392)	1/25/2000 4:16:00 AM
From: nihil	Read Replies (2) \| Respond to of 186894

Margin loans were up 25% over the last two months. When people sell margined stock, the margin loans are automatically repaid, and outstanding credit automatically contracts. When the markets go down, the money supply contracts unless buyers are borrowing enough to offset the loans that are repaid. Any one who deeply margins his purchases of falling knives and fallen angels is asking for big trouble. Money is created by borrowing, and destroyed by repaying debt.