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Non-Tech : Money Supply & The Federal Reserve -- Ignore unavailable to you. Want to Upgrade?

To: ahhaha who wrote (46)	8/10/2002 12:58:54 PM
From: Challo Jeregy	Read Replies (1) \| Respond to of 1379

You have no argument from me, Ha - I've been following and posting the Fed's movements for years now. I suppose my posted stmt was rhetorical in nature. Back in '96, when the knight made his irrational exuberance stmt, he could have controlled the situation by changing the margin requirements or adjusting the rates or even withdrawing liquidity. As we all know, the LTCM, Asian crisis, etc had him experimenting with the economy as a scientist experiments in the lab. We know, from his own words, how he longed to be Fed during the Kondratieff cycle. We are his petri dish, so to speak. I am just trying to hide near the edge of the dish, smashed in amongst the crowd, so the mad scientist doesn't see me. -g-

To: ahhaha who wrote (46)	8/11/2002 12:58:08 PM
From: glenn_a	Read Replies (1) \| Respond to of 1379

Howdy again ahhaha. You commented: "FED made a mistake in the late '90s by providing excess liquidity in order to compensate for 'crat instituted restrictive fiscal policy. Loose monetary policy with tight fiscal policy has always been the core reason behind economic failure." Hmm, that's a very mechanistic and value-neutral explanation of an orthodox credit and economic policy that in the 1990's brought untold suffering to peoples ranging from Indonesia, to Russia, from Argentina to Thailand ... and is only now coming home to roost in the U.S. and other developing nations. Can you say 1920's dejavu?! Capitist merchant banking interests ... err, I mean the FED ... adopted an ideological laizze-faire approach, whose global shock troops were the IMF and World Bank. The dominant theme was not unlike that provided domestically for Enron or the early 1990's U.S. Savings & Loan industry. This dominant theme held that the only valid development approach in developing countries was unrestrained free market capitalism that allowed unrestrained free flow of goods and money. With Communism as an economic system entirely discredited, U.S.-style, or more correctly Anglo-style Capitalism was left free to run amok held hostage to the dictates of a "Washington Consensus"-inspired World Bank and IMF which opened developing countries resources to extraordinary confiscation by Developed world Big Money interests. It is very interesting now that the U.S. Congress is widening the Enron probe to the World Bank/IMF. Enron's record in countries such as India and Argentina has not received anywhere near the press that Enron's impact to the American middle class has, but it is no less outrageous. I am presently reading Professor Stephen F. Cohen's brilliant Failed Crusade - America and the Tragedy of Post-Communist Russia. Professor Cohen's book reveals a tragedy of extraordinary proportions in Russia that has seen the impoverishment and collapse of Russia's society and economy. What is so important about Professor Cohen's work however is the emphasis on U.S. complicity in the policy errors of development efforts in Post-Soviet Russia, and the U.S.'s on-going emphasis on securing "the kind of Russia we want", a Russian that will secure U.S. foreign policy interests, rather than a Russia that is in the interests and well-being of the Russian people. For an excellent piece on U.S. policy errors in Russia, see former World Bank Chief Economist Joseph Stiglitz's Whither Reform? Ten Years of the Transition at the following link: worldbank.org In any event, to say that Fed policy erred simply by a "mistake in the late '90's by providing excess liquidity" is analytically superficial IMO. I wish that the Fed's policy errors in the 1990's were so benign, however alas, I cannot believe this to be the case. Regards, Glenn