To: ahhaha who wrote (891 ) 1/28/2001 1:36:01 PM From: ahhaha Read Replies (1) | Respond to of 24758 Amateur time from a patzer's thread:R/P's were originally meant to dampen down the effects of Federal Reserve increases/decreases as and when interest rates were changed. Vaguely accurate. The purpose of RPs is to fix or control(fine tune) the price of federal reserve credit. When daily interbank borrowing develops a dearth or excess the RP agreements create or destroy instantaneous liquidity in the banking system by causing a net change in T accounts of member banks at their federal reserve banks. It's a counter action to marginal changes in supply or demand for bank reserves which attains the goal of fixing the price of those reserves. Increases in Swaps, Derivatives and R.Ps tend to increase time based speculation in Junk bonds, stock prices, Real estate. etc. False. Perhaps the real question is what "time based speculation" means. Currently the outstanding derivatives are at $28trillion..The capital markets too are affected by this. Very funny. I wonder what other affectations are available?The Capital markets were traditionally focussed on long term growth, profits etc. Today, it is speed of return as dictated by the demands of the Money market. Absurd if not completely nonsensical. "speed of return" can't be made coherent. Speed? No matter how I try to decipher the author's intent, I can't. Because of this , the Capital markets led by the Brokerages and Money banks are now more centered on short term goals using currencies, Stocks, Commodities etc. Capital markets led by brokerage houses and Money banks? Again, one thinks that one could decipher these sentences, but they are elusive and escape interpretation.All this is great news for traders ; bad news for Investors since there are no fundamentals that can justify short term changes in stock prices. Unbelievable. This sentence is both true and false, contradictory, asserts its own falsity and truth, and perfectly elusive in meaning.