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Strategies & Market Trends : Rande Is . . . HOME -- Ignore unavailable to you. Want to Upgrade?

To: BW who wrote (49449)	3/20/2001 8:50:13 AM
From: Rande Is	Read Replies (1) \| Respond to of 57584

I will be shocked if Greenspan moves more than a half-point today. And I think the odds are more like 50 basis points=70%, 75=15%, 25=15%. Moving 75 basis points here sends the wrong signal about the economy. There are pressures on both sides of the coin. One thing worse than inflation is deflation. Deflation is what can spin out of control into deep recessions and depressions. So he is walking a fine line on wishing to pull the economy upward, but not too fast to risk inflation and not moving so sharply that it sends more CEOs to cancel expansion and cut back on staff for fear that worse times are ahead, as signaled by the Fed. Then again, he must move aggressively enough to keep us from falling too hard and start seeing prices drop as inventories rise too fast. I'd like to see 50 points with another 25 pre-approved once or twice between now and May's next FOMC. To me that gets the job done and sends the right message, without spooking either side. But once again, it will be the message that accompanies the move that will have everyone's attention. What will the FED do the rest of 2001? I would like to hear them smooth over things. . . and say that the economy is in better shape than it seems. . . and that they are on it and in control. . . .not to worry. . . more Fed cuts are on the way! However, they usually say next to nothing. And that is probably what they will do once more. . . leaving us to guess their next move. And not 10 minutes will pass before the bulls and bears begin dancing around posturing and speculating on the next FOMC meeting. Rande Is