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To: limtex who wrote (112054)	2/2/2002 9:33:07 AM
From: Jordan Levitt	Respond to of 152472

<<Those are clear signs of an impending depression.>> Are you kidding ??? This has been one of the easiest recessions in history ! Compare the % of bankruptcies to the 1991-1992 recession. What about the unemployment rate ? In the seventies we were looking at 13-14% unemployment, this time, 7-8%. Usually, when a recession begins, we have a problem with inflation. The fed then has to continue to raise interest rates to choke out this threat, just when businesses are suffering the most the cost of money increases. This raising of short term rates flattens the yield curve, this creates what bond traders call a "negative carry", I won't bore you with the details, but essentially it takes banks out of the lending business. This time, we have one of the steepest yield curves in history (creating positive carry), the lowest interest rates in forty years and virtually no inflation. Further, interest rates could be lowered prior to actually entering recession. Depression would require things to be soooo much worse than this ! Also, we have increasing global trade, the depression was to a great degree created, and certainly exacerbated by trade barriers being thrown up all around the world. Lim, it just ain't that bad. BTW, you may have noticed that home sales have remained strong, that just does not happen on the way to a depression !!!!!