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Non-Tech : The ENRON Scandal -- Ignore unavailable to you. Want to Upgrade?

To: Baldur Fjvlnisson who wrote (86)	1/11/2002 12:57:54 PM
From: Baldur Fjvlnisson	Respond to of 5185

Just as today, in the 1920s the Fed was focussed on price inflation while stock market speculation and credit excesses drove the economy and produced enormous asset inflation. Also, just as today, in the 1920s the inflation created by credit expansion was covered up by the deflationary trend in the economy that resulted from over-capacity and an oversupply of goods. The net effect of the two forces resulted in low inflation. So the Fed maintained an expansionary policy. This extended the boom even more and set the stage for the Great Depression. When the inflationary force of credit expansion collapsed after the stock market crashed, t he deflationary forces took over. The rest is history in the making. Prepare for prolonged pain.