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To: Dave-in-MarinCa who wrote (11267)	8/15/2000 6:04:40 PM
From: pater tenebrarum	Respond to of 436258

yes, he should be reprimanded for his unbullish insinuations. surely the stock market anticipates at this point that the economy will be the recipient of generous gobs of money from all quarters in view of the election. the WS liquidity machine is definitely working overtime - note the immense growth in commercial paper as noted by Noland, as well as the renewed push by the GSE's to inflate their balance sheets further. i have noted that Moto has also become a proponent of the idea that the treasury's buybacks act as de facto permanent reserve additions for the banking system, i.e. they are the functional equivalent of coupon passes. so even if easy Al were to show some restraint, the treasury would lean against that restraint. an interesting tidbit which i wasn't aware of is that the buybacks were a cozy arrangement available exclusively to domestic financial institutions, a fact that underscores the quasi-coupon pass theory.