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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: michael97123 who wrote (41230)	1/2/2001 6:41:13 PM
From: mitch-c	Read Replies (1) \| Respond to of 70976

Michael, Your Fed Futures news makes me look prophetic ... <g> Regarding some prior comments - I pitched a best-case (fastest) Bush Tax Cut <tm> in my prior scenario to illustrate the near-term impetus for a rate cut. The need gets more acute as the likelihood of tax cuts fade. There were two separate assumptions there; first, that a cut would be substantial, and second, that it would be fast. I'm confident of neither (given a contentious Congress), but they're possible. ("Targeted" translates as "not me.") The political process is the opposite of Greenspan's gradualism - it builds to one convulsive change. I do not believe Bush will be able to "go back to the well" for successive cuts, unlike rate changes. Therefore, the Fed faces the problem of jumpstarting us NOW, while not overshooting ... just in time to compound a possible tax cut boost. I suspect they will deliberately undershoot, anticipating news of a tax cut. - Mitch