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To: kvkkc1 who wrote (48541)	2/8/2001 11:56:22 AM
From: Steve	Respond to of 77400

There was plenty of evidence that the core rate increased dramatically between 1997 and the end of 1998. It was only the ameliorating effects of falling energy and commodity prices that saved the day there. The FED was at the ready in 1997 and 1998 before the LTCM crisis and the Asian crisis and the Russian currency crisis called their hand and forced them to ease and add liquidity. Those inflationary pressures that were building in the core rate between 1997 and 1998 increased in 1999 and 2000. The fact that the core rate continued to accelerate in early 2000 was ample evidence that the FED was correct to have acted in June of 1999 to begin the round of rate increases.