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Strategies & Market Trends : Commodities - The Coming Bull Market -- Ignore unavailable to you. Want to Upgrade?

To: Scripts who wrote (588)	7/23/2001 4:53:44 PM
From: craig crawford	Read Replies (3) \| Respond to of 1643

hi, nice to see a new face around here. i would have to say that i disagree with you and the consensus view that greenspan caused all these problems by raising rates. if high rates were the only thing that caused this malaise then how come aggressive lowering of rates is not providing the solution? obviously there is more at work here. in my opinion the problems caused by greenspan are just the opposite of what all these dopes on tv are claiming. they are all saying that he has been too tight and he choked off the economy. he needs to print more money to stop the deflation. what a crock. he got us into this mess with too much money and easy credit. that is what forced him into a position of having to aggressively tighten. do you really think the economy and markets were just fine in 2000? internet stocks like yhoo were worth over $100 billion yet they had hardly any profits. brick and mortar businesses with real business models and real earnings were being ignored while people gave stocks with no hope of ever turning a profit multi billion dollar valuations. you think this was healthy and this could have continued at a frenetic pace if greenspan hadn't spoiled your party with a few rate hikes? come on, let's get real here. this may sound condescending and arrogant but it amazes me how ignorant people are about what caused the mess we are in. i'm talking about economists with fancy degrees and former fed officials. wayne angell, larry kudlow, people like that. do you really think that this mess we are in was caused by greenspan tightening rates a couple years ago? hogwash. the seeds were sown by greenspan providing the market with too much credit, not too little. how come NO ONE ever complains when greenspan cuts rates? people only want it one way. they want the fed to bail out the markets when times are tough, but they don't want the fed to put the brakes on when things get out of hand. the real solution is to abolish the fed. why do we even have a fed? we got along just fine without one before 1913. the fed was created by foolish politicians who thought they could eliminate the ups and downs of the business cycle. stupid foolish politicians and bureaucrats can never outsmart the free market. in their efforts to prevent boom and bust periods by interfering with the natural business cycle, they only exacerbate things and make the booms and busts more pronounced. stupid politicians always think they can come up with some government solution to make things better for the people. all they do is make things worse. the real mistake by greenspan was not hiking rates in 1999/2000, but the easings he did in 1998. the market was trying to serve it's natural function of returning to prudent lending and reasonable valuations, and greenspan had to stick his cotton pickin hands into the mix and interfere. why did he do it? for the same reason all bureaucrats and politicians interfere. they think that we have to have an economy that grows every single year after year without any setbacks or corrections. that is just plain stupid. it is simply impossible to eliminate the business cycle, it confounds me why politicians ever thought they could try. now they have no choice, people can't tolerate any setback in economic activity--they all scream and whine. so what do people like greenspan do? they keep the party going as long as they can by printing money and telling people to take on more debt. sure the fed can prolong the business cycle, but it just means bigger booms and busts. we used to have depressions regularly in the 1800's, but they were short and sharp and then business picked up again. the relatively frequent and sharp corrections served a useful purpose, they taught the markets to be prudent and respect risk. greenspan has taught people that you can speculate all you want, i will be there to bail you out. that is why we had a mania of epic proportions and that's why people overspent, took on too much debt, speculated like mad, and now must suffer the consequences. this could have all been prevented if greenspan had simply let the markets fall when they needed to before they got so high to begin with. of course the stupid public won't allow that however, they think they are entitled to a recession free economy and permanently high stock prices.