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Politics : Stockman Scott's Political Debate Porch -- Ignore unavailable to you. Want to Upgrade?

To: Jim Willie CB who wrote (4021)	8/6/2002 5:59:49 PM
From: stockman_scott	Respond to of 89467

Some good comments on defending the economy or defending the dollar... Message 17843942

To: Jim Willie CB who wrote (4021)	8/6/2002 6:26:18 PM
From: stockman_scott	Read Replies (1) \| Respond to of 89467

Lehman Says Fed to Cut Interest Rates NEW YORK (Reuters) - Lehman Brothers on Tuesday became the latest to join the ranks of Wall Street investment banks calling for Federal Reserve interest rate cuts in coming months to prevent a renewed recession. Lehman Brothers said it expected the Fed to trim its benchmark overnight lending rate by 75 basis points to 1 percent by the end of the year. Previously, Lehman had forecast the Fed would keep interest rates steady until next year. Lehman's co-chief U.S. economists, Ethan Harris and Steve Slifer, cited recent economic data showing the recovery stumbling, including weakening manufacturing and service sector growth in July, plunging consumer confidence, meek job gains and a drop in durable goods orders. "While some of the weakness may reflect the normal ups and downs of the data, the concern is that this weakness is just the beginning of a growing shock to the economy," the economists wrote in a report titled "No Mas -- The Case For a Fed Easing." Perhaps more important in changing their forecast, the Lehman economists said tightening conditions in credit markets would likely hurt business investment and hiring. "The thing that was the final straw is the conversations with the credit strategists at Lehman talking about what a tough borrowing environment it is," Harris said, citing widening corporate bond spreads, tightening bank standards and a closed off commercial paper market. "Really it's a story around an anemic recovery with little momentum, a falling stock market with the wealth affect showing up with a lag, and layered on top of that very tight credit conditions holding back on the corporate sector," Harris said. The most likely scenario was for the Fed to change its risk statement at its policy meeting next week to declare a greater threat of renewed economic weakness and for it to cut rates by a quarter-percentage point in September, October and December, the economists said. Currently the federal funds rate stands at 1.75 percent. In the past few days, Goldman Sachs changed its forecast to a 1.0 percent fed funds rate by year-end and Deutsche Bank said the Fed would cut rates by 50 basis points in coming months. Both firms said the central bank would want to act preemptively against any threat of a so-called double-dip recession. Dresdner Kleinwort Wasserstein is also calling for a Fed rate cut, to come at the Fed's Sept. 24 policy meeting.

To: Jim Willie CB who wrote (4021)	8/6/2002 6:36:57 PM
From: stockman_scott	Read Replies (2) \| Respond to of 89467

Fed Chief Greenspan to Be Knighted The Associated Press Tuesday, August 6, 2002; 4:48 PM WASHINGTON –– He won't get to call himself "Sir Alan" but Federal Reserve Chairman Alan Greenspan – often known as the second most powerful man in the United States – will get another title: knight. Queen Elizabeth II has approved an honorary knighthood for Greenspan's "outstanding contribution to global economic stability," the British Treasury announced Tuesday. A copy of the release was distributed in Washington. Greenspan will receive the award when he next visits the United Kingdom. A Federal Reserve official would not say when that would be. "I am most privileged to accept this honor," Greenspan said in a statement. "I have valued my close relationships with the Bank of England and with many Chancellors of the Exchequer, going back nearly 30 years," he said. The award also recognizes "the benefit that the UK has received from the wisdom and skill" with which Greenspan has led the Federal Reserve Board, the British Treasury said. Greenspan will mark his 15th year as chairman of the Fed on Aug. 11. American citizens admitted to British Orders of Chivalry do not get the right to be called "Sir," but Greenspan will be entitled to place the letters KBE – for Knight Commander of the British Empire – after his name, the British Treasury said. Others Americans who have received honorary knighthoods include former New York City Mayor Rudolph Giuliani, former presidents Bush and Reagan, and entertainer Bob Hope. © 2002 The Associated Press