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Strategies & Market Trends : New US Economy Policy -- Ignore unavailable to you. Want to Upgrade?

To: Arthur Tang who wrote (273)	4/18/2001 1:02:01 PM
From: Arthur Tang	Respond to of 435

Fleet Bank announced earnings decline due to equity softness, and Greenspan lowered the overnight discount rate to 4.0%. However, the multiple still has to increase to 9.25 from 8.75 to increase bank reserve by 5% to operate smoothly and to have money to loan to customers. Monetary policy has to allow economical growth. Restrain will choke off any growth prospect and is self defeating. On the other hand, profits increase deposits and will propel growth without monetary policy change. Alas, profits can be eliminated by monetary policy itself; so understanding of such variables in aggregate of its mathematics formula, FEDs has yet to learn. Without profits, business has to leverage to higher volume to squeeze out some profit. This is where we are at the moment. Micro-economists still have to be in charge. Top down economists have to change and give up their profession.