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To: Haim R. Branisteanu who wrote (40184)1/6/2001 9:47:44 AM
From: flatsville  Respond to of 42787
 
Excellent post.



To: Haim R. Branisteanu who wrote (40184)1/6/2001 7:10:03 PM
From: DukeCrow  Respond to of 42787
 
My speculation is that the FED will try to keep the market on an upward bias pumping more liquidity and lowering interest rates to keep those financial assets afloat and by that the funding for pension funds and insurance companies in balance and liquid.

It has been reported that Greenspan's real fight is with the long-term deflationary forces rearing their head. Greenspan believes he can soften the blow by flooding the market with money. Your scenario fits into this perfectly, and I think you've got it right. The only caveat is that if Greenspan fails to win this battle the outcome may be worse than if he hadn't bothered to fight it.

Ali



To: Haim R. Branisteanu who wrote (40184)1/6/2001 8:32:07 PM
From: Jack T. Pearson  Read Replies (1) | Respond to of 42787
 
I don't think Greenspan is as concerned about the market as he his about sufficient liquidity to fund business operations. It helps the market, but that isn't the primary objective.