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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: IQBAL LATIF who wrote (36520)	1/29/2001 3:57:44 AM
From: IQBAL LATIF	Respond to of 50167

FED may cut, but cuts take some time to seep through, it has to be earnings recovery and corporate profits outlook, on that count, steep interest rates cut my help the debt payments and situation of the corporate bonds, the spreads may narrow fast, providing some relief, however the fact remains that Fed did create this for the economy NAIRU has been the dangerous dogma at the Fed.. monetary fine tuning to increse unemployment so as to cool the economy as reported by FM center has cuased this slow down, <<The coexistence of low unemployment and low inflation has shattered the notion of a fixed NAIRU (non-accelerating inflation rate of unemployment) and yielded enormous economic benefits. According to a new Financial Markets & Society report by Dean Baker, allowing the unemployment rate to remain below the supposed NAIRU has provided more than ten times the economic gains claimed for deficit reduction or major trade agreements. Baker calculates that total wage income for workers in the lowest-paid fifth of the workforce was approximately 16 percent higher in the first half of 2000 than it would have been had the Federal Reserve held unemployment at the estimated NAIRU. Despite these achievements, Fed policymakers remain skittish about low levels of joblessness>>