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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Rick Storm who wrote (4213)	3/26/2001 10:10:18 PM
From: Jacob Snyder	Read Replies (1) \| Respond to of 52237

re: "is there as scenario where the fed gives a surprise rate cut in the next month and ........we skirt a recession" Fed rate cuts take a minimum of 6 months, before they begin to affect the real economy. The previous rate hikes took a year before they started to slow the economy. So, a Fed rate lowering next month isn't going to do anything to avoid a recession. In addition, the Fed has a habit of incremental moves, which makes sense, (trying to avoid the overcompensation/oscillation inherent in a negative-feedback loop with a long delay). So, no, I don't think there is any chance, any more, of a soft landing. Consumer sentiment and consumer spending and business capital spending are collapsing too fast for the Fed to compensate in time. The range of possible futures is now: little recssion, or big recession. In addition, we need to be watching inflation. If it gets over 4%, the Fed will probably quit lowering rates, even if the economy continues to deteriorate. The Fed's priorities have been clearly stated: they seek the highest growth rate compatible with low inflation.