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To: Bucky Katt who wrote (9140)	6/28/2001 1:42:05 PM
From: James Strauss	Respond to of 13094

Good reasoning William... Take the bullish morsels within the context of the BEAR... Naz 2200 and Dow 10,700 are the next areas to crack or these indexes may crack... Jim

To: Bucky Katt who wrote (9140)	6/28/2001 4:51:12 PM
From: Jibacoa	Read Replies (1) \| Respond to of 13094

<<The FED is out of real world gas, maybe they have one more 1/4 point move, and that is it.>> William: As we commented here back in March, more important than the FED's "cuts" is how they handle the money supply. According to an article by Mr.Laffer in the WSJ back in March,the "interest cuts" are not meaningful because virtually nobody borrows from the FED. Member banks recently had only $34 MILLION borrowed from the FED which was less than 1/2 of 1/1000th of the total member bank reserves. If the 3 months T-bill would get significantly higher than the discount rate, the banks could borrow all they could for a guaranteed profit. That is the reason the FED can not let the two rates get too much out of line, and why the FED just follows the 3 months T-bill. It is the rate of growth of the monetary base what ultimately influences or determines interest rates, inflation, the price of gold, exchange rates,etc. So the thing to watch is how uncle Al handles the monetary base.<g> RAGL Bernard