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Strategies & Market Trends : The Amateur Traders Corner -- Ignore unavailable to you. Want to Upgrade?

To: puborectalis who wrote (8662)	4/26/2001 12:25:05 AM
From: Druss	Read Replies (2) \| Respond to of 19633

Fallope<<The Fed still has a lot of room to lower rates.>> I am not so sure, rate reductions hit in a number of areas. With the American stock market looking less and less charming as an investment an investor may also find the low payoff in American bonds and banks unattractive too. The result can be a flight of capital to other parts of the world. There is a lot of foreign money invested in the US, rate reductions can make the US less attractive. I suspect the Fed sometimes feels it has to dance on the edge of a sword. They have to balance inflation, foreign and domestic investment pressures, dodge a recession, and keep the money supply at the right level. There may not be a correct level of interest rates to do this. All the Best Druss